Economy minister rejects lower hotel VAT

I have read an article in the online version “Austriantimes.at” and it deals with lower value-added tax on hotel rooms.

So Economy Minister Reinhold Mitterlehner rejected calls for lower VAT on hotel rooms. He thought it would be more important to improve the strategy and marketing.

Mitterlehner also said that the ministry would meet tourism organizations in order to discuss a strategy for 2010.

The Austrian Hotel Association aimed to make the hotel industry more competitive. Therefore they called for it to be lowered and that is the reason why the VAT should be decreased from the current 10 to 5 per cent.

But ÖHV co-president Peter Peer pointed out that bookings have not gone down much since prices and turnover had plunged. In addition he mentioned that the VAT rates on hotel rooms were 3.6 per cent in Switzerland compared to 5.5 per cent in France and Italy.

In my opinion it’s unnecessary to lower the VAT because I think the hotels are actually not in a crisis as Peter Peer remarked that the bookings have not much to decreased.

http://www.austriantimes.at/news/Business/2010-01-21/19868/Economy_minister_rejects_lower_hotel_VAT_

Words:

to plunge (schnell sinken) : Prices and turnover had plunged.