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Reducing VAT in Serbian tourism is not realistic

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There is still no final solution on how to help the tourism sector, primarily hoteliers, because different models are still being considered, Tourism Minister Rasim Ljajic told Danas.
Representatives of the state, the Ministry of Finance, PKS, but also hoteliers are in the working group that should decide how the state will help and whom in the tourism sector, which is one of the most endangered due to the corona virus epidemic, and meetings on new measures have been going on since last week.
“For now, we have mostly talked about helping hoteliers, we are looking to include as many of them from the entire sector as possible, but everything will depend on the financial situation, when we know how much money there is, we will know more. We are considering several models, but there is no final solution yet,” Ljajic points out for our paper.
He says some of the options, such as VAT cuts, are not realistic due to lack of money.
Tourism will suffer a billion dollars in damage this year, and the hotels in the cities that remained in a difficult situation even after the lifting of the state of emergency were the most affected. Only in June, according to the SBS data, there were fewer foreign tourists compared to the same month last year by as much as 84.8 percent. Thus, the occupancy of city hotels this summer was lower by 96 percent compared to the same period last year.
HORES estimates that recovery or any earnings in their sector are not expected in the next two years, because for 2021, but also for the beginning of 2022, there are no scheduled international conferences or seminars that were the main source of income for city hotels.
The association of hoteliers therefore asked the state to reduce VAT, abolish parafiscal levies, but also to enable them to report seasonal workers similarly to what was done in agriculture.
They warn that since the beginning of the crisis, 30,000 such workers have disappeared from the catering industry and are nowhere to be seen.
Although the number of domestic tourists dropped by 17.2 percent in June, it seems that the only bright spot of this year’s tourist season was the good filling of capacities in rural tourism, spas and mountains, because a good part of domestic tourists gave up the sea and abroad fear that due to the complicated procedure for entering certain countries.
While Belgrade, Novi Sad and Nis had 55 to 65 percent fewer guests in the first six months of this year than at the same time last year, mountain and spa places recorded slightly better percentages.
Some destinations, such as Gamzigradska Banja or Stara Planina, even had an increase in guest arrivals of eight and six percent, respectively.
“Some domestic destinations such as Zlatibor, Kopaonik, Vrnjacka Banja, Sokobanja are full, which in June was the first destination in the country with 110,000 overnight stays. Belgrade was only in the fourth place,” notes Ljajic.
He says that rural tourism has experienced a great expansion and reminds that the great influx of domestic tourism is the result of an epidemic, and not thanks to additional vouchers.
“Out of 400,000 vouchers for subsidized accommodation, as many as we released, some 102,000 have been distributed so far. Just when we released them, the second peak of the virus epidemic happened, and at that moment, a good part of them who were planning to give up. That is why this is the first year where we have a larger number of employees who use vouchers, and not pensioners as it was before,” emphasizes the Minister of Tourism Rasim Ljajic, Danas reports.

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