Hotel occupancy tax hike could lead to fewer tourists: GVB

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Guam – Guam Visitors Bureau President Nate Denight responds to Speaker BJ Cruz’s proposal to increase the Hotel Occupancy Tax by 4%, stating that the hike might lead to less visitors to the island.

Speaker BJ Cruz yesterday introduced Bill 314, which would raise the Hotel Occupancy Tax from 11 percent to 15 percent, in an effort to address the projected $145 million shortfall in the coming fiscal year.

In an interview between Patti Arroyo and Nate Denight on K57 early this morning, Denight states that increasing the Hotel Occupancy Tax to 15% may really hurt the tourism industry. Denight explains that hotels on Guam and airfares to Guam have already been raising rates over the years and increasing the tax would just make Guam become a more expensive destination, competing with other destinations such as Southeast Asia and Hawaii.

GVB President Nathan Denight says, “You have to remember that on that hotel room stay, that tax is already added to that stay. The tax would be 20.5% per night if you take those two taxes together so I think that’s quite a large tax on a night stay on a room on Guam. Obviously, any time they raise prices, there is a decrease in volume. It would definitely have a negative impact.”

The increase of Hotel Occupancy Tax would take effect October 1 if enacted into law.

Speaker BJ Cruz also introduced Bill 315, which would raise the business privilege tax to 5.5 percent.