Accommodation establishments have met difficulties in accessing the support package on land rent reduction
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The Tourism Association stated that in fact, there have been many policies of the State to support businesses and workers in general and the tourism sector in particular, suffering from the impacts of the COVID-19 pandemic.
In particular, these are Decision No. 33, Decision No. 23, Resolution No. 126 and Resolution No. 68 of the Government on a number of policies to support employees and employers facing difficulties due to the COVID-19 pandemic. Besides, there is the Resolution No. 154 amending the Resolution No. 42 of the Government on measures to support citizens facing difficulties due to the pandemic. And the Decree No. 92 of the Government detailing the implementation of the Resolution No. 406 of the National Assembly Standing Committee promulgates several solutions to support businesses and people affected by the pandemic.
In addition, the Resolution No. 84 continues to remove difficulties for business production (reducing land rent for those affected by the COVID-19 pandemic). And, the Resolution No. 41 reduces the electricity selling price for tourist accommodation establishments, from the retail price of electricity applied for business to the retail price of electricity applied to the manufacturing industries. Besides, the Decree No. 52 extends the deadline for payment of value added tax, corporate income tax, personal income tax and land rent in 2021.
Provincial leaders visit and encourage tourism businesses being affected by the pandemic
In fact, tourism businesses get no or just very little benefit from most of the above policies. Mr. Dinh Manh Thang, Chairman of the Provincial Tourism Association gave an example that in the Decision No. 33 and Decision No. 23 of the State on the implementation of several policies to support employees and employers encountering difficulties, it is very difficult for businesses to apply for this since the time to pay compulsory social insurance is within 2021, when very few businesses can still operate. In fact, most tourism businesses have had to reduce labor and stop paying social insurance premiums for employees from mid-2020 or even earlier. The reason why businesses temporarily suspended operations was that there were no customers for them to serve, not as the request of a competent State agency to prevent and control the COVID-19 pandemic.
Similarly, in the Decree No. 92 of the Government detailing the implementation of the Resolution No. 406 of the National Assembly Standing Committee to support businesses and people, there is exemption from personal income tax, value added tax and other payable taxes arising from production and business activities of the months in the third and fourth quarters of 2021 for households and individuals having production and business activities in district-level areas affected by the COVID-19 pandemic in 2021, shall be decided by the Chairman of the People's Committee of the province or of the centrally-managed city.
However, in Hue, enterprises, mainly located in the city, are not entitled to this policy. Also in this Decree, there is support to reduce value added tax from November 1st, 2021 to the end of December 31st, 2021. However, during this tax reduction period, very few tourism businesses were still operating and generating revenue, so this policy does not provide much support for businesses.
Mr. Nguyen Huu Binh, Chairman of the Provincial Accommodation Association added, Decree 92 stipulates the exemption of late payment interest arising in 2020 and 2021 of tax, land use levy and land rent debts for enterprises, but it did not apply to cases where late payment interest had been paid.
For the accommodation sector, it is necessary that businesses have to rent land in prime locations, so the rent is higher in addition to their feeling afraid of the effect of the land lease contract maintenance and the legality. Therefore, they must focus their resources on paying taxes, including late payments. Therefore, the majority of accommodation establishments in Hue do not benefit from this important policy. Enterprises are in desperate need of being refunded the late payment money that enterprises have paid or deducted from the tax payable in the following periods.
Policies must be accessible to businesses
Mr. Dinh Manh Thang shared that enterprises acknowledged they had to put more effort and solidarity to overcome difficulties together during this period. However, there are aspects and fields that tourism businesses need support. "In a recent meeting with the Vietnam National Administration of Tourism and the Vietnam Tourism Association, we also frankly pointed out the reasons why businesses cannot access the policies, and emphasized the policies that are needed to help real businesses," said Mr. Thang.
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Tourism businesses urgently need more support packages to make their business more effective again
Accordingly, tourism businesses are expected the VAT rate to be reduced from 10% to 5% for consumers by 2023. This reduction will help tourists reduce the amount they have to spend on tourism activities, hence creating conditions for them to participate more in tourism events and programs. Along with that, it is possible to reduce corporate income tax from 22% to 17% so that tourism businesses can overcome difficulties and have accumulation.
Besides, they also hope to be able to access more interest rate support loan packages. Regarding support policies for employees, the support policies should be implemented through labor management enterprises. This is because when businesses have already had full information related to insurance, personal tax code, etc., it will be more convenient for them to support employees.
Mr. Tran Huu Thuy Giang, Director of the Department of Tourism, said that the industry truly understood the current difficulties of enterprises. It is true that support policies are beyond the departmental level, as well as the provincial level.
However, from the perspective of local industry management, the Department of Tourism has a lot of policies to support, such as promotion, labor retraining, and procedures for welcoming and serving guests. Hopefully, the next support policies will aid businesses more, especially in the adaptation period. Particularly, there will be many changes in activities and handling plans when the pandemic happens.
The Vietnam National Administration of Tourism and the Vietnam Tourism Association said that they will synthesize comments and continue to propose those to higher levels. In this December, there will be an unusual session of the National Assembly to approve support packages to stimulate economic recovery and development. It is hoped that policies will be accessible to tourism businesses and workers, to create momentum for recovery in a new adaptive state.
Story and photos: Duc Quang