Tourist tax will take three months to flow into CTO coffers

TOURISM Minster Nicos Rolandis yesterday told the House Finance Committee that a loan would be needed cover the three-month interim before the CTO saw any money from the reintroduction of a tourism service provision tax.

The Council of Ministers this week decided to bring back the three per cent CTO charge for the provision of tourism services, Rolandis told the Committee.

The Council of Ministers also decided to bring VAT for hotels down from the current eight to five per cent in order for the industry to be protected.

Rolandis yesterday told Finance Committee that the money would take three months to begin to flow into CTO coffers and said a government guaranteed loan would be needed to bridge the gap.

He also asked for the House of Representative’s support in requesting the loan.

The three per cent tax is seen as essential to fund the Cyprus Tourism Organisation (CTO), whose budget deputies refused to approve last month.

The tax had been scrapped in an effort to compensate the tourist industry for the loss of business suffered during the Gulf War.

Finance Minister Takis Klerides on Monday told the Finance Committee that the tax would be reintroduced from November 1 this year.

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