Positive holiday for the tourism sector, which gives greater merit to the elimination of restrictions than to the reduction of VAT

After the four days of holidays, the weekend of February 26 and 27 and the two days of carnival (February 28 and March 1), the balance was positive for the tourism sector, which saw increases in the occupation of hotels and attendance at restaurants, among other businesses.

Entrepreneurs and union leaders of the tourism sector consulted by Diario EL UNIVERSO agreed that the temporary reduction of VAT from 12% to 8%, which the authorities ordered for these dates, was a driving factor, but it was not the predominant factor for the good results .

For Douglas Dillon, operations manager of the Hostería Farallon Dillonin Ballenita (province of Santa Elena), the reduction of VAT to 8% during the days of carnival helped to lower the final price paid by the visitor.

Adjusting accounting systems for VAT reduction from 12% to 8% is not so easy, say tourism business owners

He assured that it was a strategy with a great psychological impact on people that motivated the tax base to be expanded and more businesses to enter the formal sector, thus benefiting the entire productive system.

“The final effect (lowering VAT to 8%) is not a big deal, but people like that listen to it as a small discount is positive… we have done very well this whole year of the reactivation, not just this one that we are just starting the previous one, but because we have focused, and it has cost us a lot, on health tourism, on more conscious tourism and with everything that happened last year, people are more attentive to these things, people who are looking for open destinations and destinations with natural ventilation”, explained Dillon, who maintained that on this holiday they grew between 10% and 15% more than the normal flow that they would have expected.

For its part, Carlos Abad, president of the Santa Elena Chamber of Tourismconfirmed that this was an “excellent holiday without a doubt”, which has resulted in an increase of at least 50% in movement for businesses in the tourism sector compared to the 2021 carnival holiday.

Although he assured that the reduction of VAT to 8% was not the main factor when making the decision to go on vacation by tourists.

“The elimination of certain restrictions such as free access to restaurants, beaches and being able to move more freely had more weight when deciding to go on vacation on this holiday, it is an incentive, yes, but it was not the main factor” , analyzed the leader.

While, Holbach Muñeton, president of the Federation of Chambers of Tourism of Ecuador and vice president of the Ecuadorian Business Committee, He maintained that the holiday has generated good figures, although at the moment it is difficult to calculate exactly the revitalization of the sector, but he believes that it should be above the $75 million in income and an average of more than two million people who traveled to different destinations in the country for this holiday.

He highlighted destinations such as Riobamba, which was well received on this holiday, as well as places in the east such as Zamora Chinchipe, where more than 30,000 people visited cantons of that province.

By reinforcing security, the VAT reduction to 8% proposed by Guillermo Lasso for the carnival holiday would have a better impact on tourism

However, despite the good results, in general, which he classified as the entrance to an economic recovery, Muñeton clarified that this does not mean that the numbers are no longer in the red.

“It’s very good, because if this were constant, it was every week, it would be interesting, but this does give places a break,” said Muñeton, who agreed with Abad in pointing out that the VAT reduction was not the main reason for the good development of the demand in this holiday.

“In some destinations I have been informed that tourists were not informed or aware of the VAT discount, rather in many destinations the VAT has been a complication,” said the union leader, who insisted that the measure to reduce VAT should apply on dates that are not holidays to boost tourism.

Muñeton ratified that the release of the restrictions have generated the growth of the movement in the tourism sector. (I)