Updated:Positive trend in tourism continues
(Adds statement by Tourism and Economy ministries)
The tourism industry’s positive trend continued in the third quarter and prospects for the last quarter and the beginning of next year look good.
Eighty per cent of five-star hotel operators believed that the rates would improve. A total 56 per cent believed that their occupancy would remain the same over the next quarter but three and four star hotels were seeing better occupancy levels and better rates.
The gross operating profit of the third quarter improved in all three hotel categories - by 10.5 per cent in five star hotels, by eight per cent in four-star hotels and by nearly 12 per cent in three-star hotels.
While thanking the Finance Minister for the 15 per cent tax incentive on costs related to refurbishment and extension of property, MHRA president Tony Zahra said the association was very disappointed that the budget did not reduce the seven per cent VAT rate increased two years ago. It also did not reduce energy bills by 4c per kilowatt hour as had been requested by the association in its pre-budget request.
To make matters worse, on December 1 hoteliers also had to face an increase in the cost of heating oil.
MHRA asked for yet another MCESD meeting to specifically discuss Enemalta.
At the moment, the corporation was a problem and should not be politicised, Mr Zahra said adding that operators within the tourism industry were being made to pay for the corporation’s inefficiency and charged for every single penny it spent. This formula needs to be changed.
“Because we are financing the inefficiency of Enemalta, we cannot fund refurbishment projects at our own properties. We invested money, time and a lot of effort and only we can make things happen in the tourism industry, the most important sector of the Maltese economy,” he said.
Mr Zahra said the government raked in 34 per cent of its income from the tourism industry which should make the minister of finance the happiest man in Malta.
In a statement, the Economy and Tourism ministries expressed satisfaction at the results obtained by the industry which saw five star hotels increasing profitability by 10.5 per cent over last year (17 per cent over l-2008); four star hotels by eight per cent 8 per cent (3.6 per cent) and three-star bi hotels by 11.9 per cent (22 per cent).
The ministries said that in this legislature, the government had increased the annual allocation for the sector by €12.5 million more than in 2008, when the allocation was €24.5 million.
It had also invested strongly in the country’s accessibility and there was a substantial increase in routes towards and from Malta as well as investment in the restructuring of Air Malta. The number of routes had increased from 47 in 2008 to 81 this year.
Moreover, the VAT rate on the sector was, at seven per cent, among the lowest in Europe with 22 out of 27 countries having a higher rate.
Hotels and restaurants had also been assisted through other direct incentives.