HRRAC seeks tax relief for ailing hotel industry

CEBU, Philippines —  The Hotel, Resort and Restaurant Association of Cebu (HRRAC) is seeking for tax relief to avoid hotels and resorts in Metro Cebu from going bankrupt.

“There are some hotels that are already considering, if not already filed bankruptcy. We don’t want this to happen. Thus, as an organization we are asking initially the Cebu City government to craft a tax reform program to save the tourism sector,” said HRRAC president Alfred Reyes during the Tourism Coffee Table Meeting held June 3, 2021, at the Marco Polo Plaza Cebu, as part of the Cebu Business Month (CBM 2021).

Reyes said a year after the slump, due to the pandemic, hotels can barely pay their taxes, most if not all are running dry, even incurring losses already.

HRRAC will be writing a formal request to the Cebu City government, and coordinate with Mayor’s office on this emergency need.

What HRRAC is asking, Reyes explained is not free tax for hospitality sector, but tax relief while the players are experiencing difficulties in business.

He hopes that an ordinance will be passed on this matter. It may allow or waive some penalties so that some hotels, resorts and restaurants can re-open while preparing for the recovery.

For the government, this could be a way of helping stakeholders to make sure “they stay in business” rather than closing doors—for good.

Similar approach will also be done in order local government units (LGUs) in Mandaue City and Lapu-Lapu City.

He said this request can only be applied to other micro and small and medium businesses that are cash-strapped and could hardly pay for their tax penalties.

Reyes clarified that despite the existing OWWA (Overseas Workers Welfare Administration) sponsored bookings for returning overseas Filipinos (ROF), hotels are still suffering financially.

Although the local staycation is growing especially during weekends, it still cannot sustain the overall operational expenses, let alone paying tax penalties and regulatory dues.