One Hotel Received Majority of Concession In 2013

Ian DaBreo, President of the Grenada Hotel and Tourism Association said that one hotel received the majority of the EC$28.4 million in concessions which Government provided to the tourism sector in 2013.

A Government release earlier this month said the tourism in particular hotels was the second highest entity to receive exemptions at the Customs and Excise Division, with the first being the Grenada Electricity Services.

“I can say for a fact, that for 2013 it was Sandals who received the majority of that concession,” DaBreo said without providing documentation to back his statement or to point out the level of concession which was provided to other properties during the year.

“Most properties only receive concessions when engaging in additional work and Sandals as you know was the biggest hotel project for last year and that is why it received the majority of the concession,” he said while explaining that in the aftermath of Hurricanes Ivan and Emily the tourism sector received significant concessions. Dabreo is of the view that concessions to hotels will be minimal in 2014.

Sandals LaSource opened its doors on 21 December 2013, less than one year after starting construction. During the peak of the construction period 1,900 construction workers were employed. Its agreement with the Government provides not just for concession on construction materials but all imports for use at the hotel.

Under the homegrown Structural Adjustment Programme, Government in a statement from the Ministry of Finance said it has made the decision to reduce concessions to help improve revenue collection commencing with the most profitable companies. In the latter part of 2013 the Parliament approved a 50% reduction in concessions in 2014 for GRENLEC which tops the concession list with EC$31.4 million in 2013.

“The additional revenue will help close Government’s monthly fiscal gap. Most importantly, closing this gap will trigger the release of approximately EC$90 million per year from development partners that will allow for the provision of vital services as health and education as well as financing of Government’s capital development programme,” said the statement.

Besides GRENLEC and the Hotel sector the other entities/groups receiving the most exemptions were:

  1. Manufacturing                – $ 9.7 million
  2. St. George’s University  – $5.8 million
  3. Statutory Bodies             – $4.7 million
  4. Religious Bodies             – $3.4 million
  5. Construction                   – $3.3 million
  6. Returning Nationals      – $3.3 million

Excluding Goods of CARICOM Origin ($21.5 million) and Government Imports and Contracts ($14.7 million), total Customs exemptions in 2013 were $99.7 million.

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