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All-inclusives, good or bad for the country?

Posted by Spod at 15:5 on Dec 1 2010

A recent news item (read article) said that 80% of all-inclusive hotels in the Dominican Republic are losing money.
This report was based on a study by the Dominican tax office which showed that they were collecting very little tax revenue from these large companies that have for many years been considered a mainstay of the Dominican tourist industry.
Interestingly, the report also said that there are even some incentive schemes in place that exempt some of these hotels from paying taxes.
But if these large companies are not paying tax, and the goverment keeps selling them prime beachfront land cheap, where is the benefit for the Dominican citizen?

Let's just take a quick overview - the tourism industry is really the best opportunity the country has to bring in money and provide employment, but the way the country organizes this is far from ideal.
All-inclusive resorts tend to denigrate the country to tourists, suggesting that for their safety, tourists should not leave the resort. This means that independent tourist businesses in the nearby towns see little of the tourist dollars, which instead is spent inside the resort, perhaps on resort organized trips.
This admittedly is a generalization, but a fact nevertheless.
A good percentage of such tourists do not even venture outside the resort, except to get to the airport on their way home.
All-inclusives do provide jobs, but they are badly paid, and many large hotel companies manage to flaunt employment law, firing staff at will and avoiding benefits outlined in the law.

So how much of a benefit are these all-inclusives, which represent the largest part of the entire Dominican tourist industry?
To most Dominicans, I would guess the answer is far less than previously imagined.

So to sum up, the all-inclusive hotels
1. Create jobs
2. Provide cheap(ish) vacations for tourists, thus bringing more visitors to the country
3. Attract dollars into the economy

but
1. 95% of the jobs they offer are extremely low-paid and below the rate to pay tax
2. They tend to dissuade visitors from leaving the all-inclusive enclave, suggesting the the country is dangerous, which means 100's of businesses outside the resort don;t get a look in.
3. According to the report, don't provide any worthwhile tax revenue to the country

and 80% of them lose money...
but they have got their hands on some nice real-estate!

Comments (1)

Posted by: Yannick martin on Aug 10 2011 17:1
Well soon there will be NO all inclusive. Has anybody leaving here that many hotels have closed down and that the north of the DR is dying too. Who is doing what to help and how.Wonder why so much delinquence, drugs and prostitution. Many more hotels will closed down, more people out of work and so forth. The politics here leave in a world of cockoo's land and seemed to think that everything is OK as long as they put plenty in their pockets.


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