It is with confidence that I say to the Members of this Honourable House, Citizens and Residents of Antigua and Barbuda that the Government in seeking to amend the Investment Authority Act of 2017 is seeking to protect the interests of the people of Antigua and Barbuda, which is of paramount importance.
The Government deserves our unreserved congratulations for its vision in always working in the best interest of the people of Antigua and Barbuda
Under the proposed amendment, hotels must follow a specific protocol and issue timely notice of temporary closure, which if they fail to do so it MAY result in the suspension of concessions by the Government for failure to follow the law. In other words its not mandatory and solely by the discretion of the Government.
Rationale for the Amendment
Tourism is the lifeblood of our nation. This is not just a mere cliché, but declaration that’s founded in fact.
We have no natural resources except the God given beauty of our land and sea, our warm and friendly God fearing people. It is this human capital and patrimony that must be protected. Tourism for us is what Oil is for the Saudi Arabia, Kuwait, Nigeria and Venezuela, what Bauxite means for Jamaica, What gold means for Guyana, and what diamonds are for Botswana. We must therefore protect this critical industry at all cost!
It is estimated that the tourism sector provides revenues of approximately US$750 million to the country, and is responsible for 50% of all investment, and 70% of our GDP. Our success as a nation relies on the success of Tourism. In other words where goes Tourism there goes the Nation!
As the CTO’s General Secretary Hugh Riley said earlier this year about our region, “We are the world’s most tourism-dependent region, and we must care more than anyone else. No one should pay more attention to delivering a superb experience than we in the Caribbean
The amendment to the Investment Authority Act is tangible demonstration that our Government Cares more than anyone about, not just our visitors who we welcome every day, but also the employees. In fact 51% of all the workers in this country are directly or indirectly employed in the industry.
The amendment to this bill clearly show we care about the local supplier who provide, services to our hotels, the taxi driver, vendors, watersports operators, and the international tour operators who send their guests to Antigua and Barbuda.
Indeed, not just for Antigua and Barbuda but tourism, on average, now accounts for a significant percentage of the Gross Domestic Product of CARICOM countries taken as a whole.
Greater demands are made on the tourism sector throughout CARICOM to deliver employment, revenues and foreign exchange as well as a competitive product.
This amendment will no doubt reverberate among CARICOM and may well become a standard to be emulated throughout the region, as it is an amendment that protects all stakeholders in this tourism industry and shows that we are all equal partners.
It Will not Harm Hotels; But offer Protection to all
This Bill speaks to Hotels who have 3% of the country’s total room stock. Let me respond to Leader of the Opposition who may not be able to calculate this 3% of our approximately 3,000 rooms, which means hotels of 90 rooms or more such as Blue Waters, Jolly Beach, Carlisle Bay etc. This means that it will be in no way punitive to any properties, and will not impact our smaller properties. In fact it is seeking to ensure that there is proper consultations with all the stakeholders whenever major renovations or refurbishments are planned that will have an impact on our country.
We cannot have a situation where hotels close willy-nilly for long extended periods with no prior consultation at all. This is particularly so when the Government has given so much by way of concessions to ensure that Hotels are profitable and can remain competitive.
Antigua and Barbuda is Investor Friendly
This Government has demonstrated by its track record that it is investor friendly. Please permit me to list just some of the generous concessions given
- Exemption from or reduction of payment of Custom duty, Revenue Recurring Charge (RRC) and the ABST on the importation or purchase of raw materials, building materials, furniture, fixtures, fittings, appliances, machinery, plant and equipment for use in the construction and operation of the business
- Exemption from or reduction of Custom duty, RRC and ABST on the importation or purchase of vehicles for use in the operation of the business
- Reduction of property tax in respect of land and buildings used in the operation of the business
- Exemption from or reduction of payment of income tax under the Income Tax Act
- Reduction of Stamp duty payable by the purchaser or transferee, and by the vendor or transferor of land
- Reduction of stamp duty under the Non-Citizens Land Holdings Regulation Act
- Exemption from or reduction of withholding tax on dividends, etc. under the Income Tax Act
The Tourism and business Special incentives act, also gives a host of incentives to ensure that our Hotels remain competitive. They receive up to 25 years tax holidays with the ability to repatriate their profits.
This Government has demonstrated that it is business friendly. We have bent over backwards to ensure that business can compete and thrive in our business environment. (see attached table)
All Stake holders are important:
We are a country of laws and a country of order. The amendments to this bill serves to protect and build on
the solid foundation laid over the three years in the area of Tourism, Economic Development Investment and Energy. Our actions have now begun to bear fruit, and as a Government we cannot allow the fruit to be aborted.
The nation has started to see the tangible deliverables of our Administration’s efforts to improve the standard of living for the good people of Antigua and Barbuda, and this amendment seeks to ensure that we preserve the standard of living for our people.
It seeks to ensure that their lives, which are linked to employment in the industry, will not be thrown into a tailspin by an untimely closure of any hotel prior to every measure being taken to mitigate the negative consequences of hotel closures.
It’s Not a political issue but a National One
Right now, the world faces a high degree of political and economic unpredictability.
In the United States, the Caribbean region’s biggest trading partner and the country from which a large number of tourists come, there is great uncertainty over its future direction.
Amid all this, greater pressure is put on the tourism sector to deliver employment, revenues and foreign exchange. This amendment serves to safeguard Government’s revenues from the sector and employment of Hotel Workers
In fact this is a bipartisan issue that I trust the Opposition and the ABWU, will support and join forces with the Government to work in the best interest of the people of Antigua and Barbuda.
Following a statement released by my office in summary of a Cabinet meeting with the Sandals management, Please permit me to respond to issues they raised and to also refer to a letter from Sandals to Mr. David Massiah the General Secretary of the ABWU dated 20th July the day immediately after a delegation from Sandals met with the entire Cabinet. It reads
“having enjoyed a respectful working relationship with the ABWU over 25 years and because of the sincerity of your appeal our Chairman the honourable Gordon Butch Stewart upon receiving your request has been reviewing the scope of works”…….
Is Sandals saying that they have not enjoyed a respectable relationship with the most important stakeholder which is the Government of Antigua and Barbuda, and are they saying that only the union has been sincere in this matter?
To add insult to injury the Sandals delegation left the Cabinet meeting and gave us the assurance that they will send a draft press release for our approval, which would be jointly issued.
They reneged on their promise to reply to us but rather wrote to the union thanking them for their “level-headedness and responsible approach to this matter” giving them an assurance that they would be reviewing the original scope of works. This is disrespect of the highest degree to a sitting Government and Cabinet, where Sandals appear to be attributing our Prime Minister and his Government’s defense of the workers and stakeholders in this industry to be irresponsible and not level headed.
It appears that Sandals after all these years of enjoying a good relationship with the Government, by these innuendos is willing to now only acknowledge the Union as the only “responsible and level headed “stakeholder in this issue”.
It appears that that certain senior union officials are well compromised by some Hoteliers for the sponsorships they receive for their football clubs and are willing to sell the workers down the river, rather than stand up for the workers interests and rights.
I would like it to be clear that I do not receive any brown paper bags from any Hotelier that would cause me to compromise my integrity in always standing up for truth, for the interest of Antigua and Barbuda and fro what is right.
Sandals in their response to me also took issue with reference to their non-payment of ABST, which had been collected and not paid to the Treasury of Antigua and Barbuda. I quote “Similar statement has been made by others and has been repeated to often for Sandals to ignore and will be dealt with as a separate issue”
Is Sandals threatening to sue me for speaking the truth? Well if so my response is “Bring it on Baby” as this would involve the release of the Deed of settlement with Inland revenue, which is clear in its language.
I would like to speak to the issue of the old Agreement that Sandals had signed with the former UPP administration
In seeking a legal opinion on the legality of certain provisions entered into on 2nd December 2103 between the then UPP and Sandals Group
Mr. James Guthrie QC gave the following opinion
“Subject to any such regulations having been made and published, put before the house etc. the grant of concessions under section 16 of the Finance Administration Act would therefore been unlawful and ultra vires as beyond the Minister’s statutory powers to grant the remission of tax”
However the grants were made in general terms in advance and the amounts of $50,000 in an Antiguan statute must mean EC$ and not US$
He continue in his opinion “ This apparent illegality goes further than the reduction in the rate of ABST for Grand Pineapple. It affects all of the tax concessions set our in the second schedule (these are lumped together in the certification letters on 10th June 2014”
“The consequence in my opinion is that under the agreement Sandals are not entitled to account for ABST at the reduced rate of 35% under item 8(a) in respect of Hotel Room Rates at Grand Pineapple and must account for ABST at 12.5% i.e. the capped rate.
Why would Sandals agree to a settlement that would allow them to be released of the total amount owed as assessed by inland revenue, if there was no liability to begin with in the first place.
The Government & Sandals agreed to a settlement of the outstanding areas, on the condition that Sandals will pay its ABST obligations going forward from 1st January 2017. This is what’s done by every other hotel on island.
Even after a Deed of Settlement with Inland revenue Sandals was still insisting on getting credits on taxes it had not paid. Please permit me to quote the position from the Inland Revenue Department, which says
“it is impossible to have an excess credit an a tax debt simultaneously for the sam period as the tax payable to the commissioner of IRD” Strictly speaking the taxpayer should not be allowed any credit brought forward at all”
The position of the Government was clear as articulated by Inland Revenue
The Government has bent over backwards to accommodate Sandals as an EQUAL Partner in the Tourism equation to ensure that they would not be negatively impacted in meeting their entire obligation to inland revenue. This is what you call levelheadedness and responsibility in Government.
Workers matter under this Administration
Unemployment knows no colour or nationality. Our Faithful workers in the hotel industry are not a commodity to be discarded for months at a time like a used “Kleenex” or disposable waste. V.C. Bird the Father of our nation put that notion to rest many decades ago!
Our employees in the tourism industry are not commodities but rather equal stakeholders. They are critical partners and must always be treated with respect, with justice and equality. Their rights must be preserved and their dignity upheld. This is what this Antigua and Barbuda Labour Party stands for and this is what we will ensure happens under our watch.
We therefore make no apologies for putting the interest of all the stakeholders in the Tourism industry on the front burner!
We need to be strategic, dynamic, proactive and adaptive to all opportunities for strengthening and growing our tourism industry. That is exactly what this amendment seeks to do!
This is about protecting our image and reputation
For the past week and a half we are have been working with the AHTA and overseas operators in mitigating the PR fallout of the imminent closure of one of our major hotels with persons who have booked and paid their honeymoon.
Our offices have been inundated with calls from couples in tears who have paid Sandals up to last week and then received a letter from Sandals that indicated they were closing for 5 months. Cold Heartedness at its worst!
This has made the international TV news on CBS in the USA and Daily Mail in the UK and not to mention social media.
I must commend the AHTA, particularly, such properties as, Galley Bay, The Elite Island Resorts and Blue Waters who have made a decision to match whatever rate was quoted by Sandals, and accommodate those displaced couples at their properties. This shows the commitment of our other stakeholders who are joining with us in working in the best interest of Antigua and Barbuda.
The shortsighted hostile act in announcing the closing of a major property has been a PR nightmare for Sandals Resort International. (See attached news Clips below)
This is what a teary eyed bride to be Ms. Brooke Straughan had to say
“Every little girl dreams of this day. And this is something I’ve envisioned for year and years and years… and now I’m being told, it’s cancelled,”
Couple’s Destination Wedding Cancelled By Resort
July 21, 2017 9:54 PM By Andrea Lucia
DALLAS (CBS11) – When Brooke Straughan was struggling to plan a small wedding; she turned to her fiancé one day with an idea.
“I said, ‘How do you feel about getting married on the beach?’” she recalls.
“One hundred percent. Yes!” Daniel Held replied
Online, they found Sandals Grande Antigua.
With a four-night stay, the all inclusive Caribbean resort offered a free wedding package, complete with the flowers, cake and a reception venue.
Seeking to keep their big day as stress-free as possible, the couple booked the deal in April and invited their families.
“It seemed like everything was going fine,” said Straughan.
With two and a half months to go, though, she received an e-mail Thursday.
“We have an important update regarding your celebration,” it read.
She called and discovered the resort would be shutting down for renovations in September, two weeks before her October wedding date.
“Every little girl dreams of this day. And this is something I’ve envisioned for year and years and years… and now I’m being told, it’s cancelled,” she said.
The couple says they were offered a chance to reschedule their wedding for next year or move it to another one of Sandals’ 15 locations elsewhere in the Caribbean.
Neither the couple nor their guests, though, had booked everything through Sandals.
“We’re talking about almost $1,000 per plane ticket that everyone would be out,” she said.
The couple’s now trying to salvage their wedding competing against others for any other available venue on the island.
They blame the resort for failing to warn them that a renovation project might affect their plans.
“If they had just said. ‘it’s a possibility’, that would have gone a long way with me, just to let people know, ‘There’s a possibility we’ll be closed’,” said Held.
CBS11 reached out to both the Sandals Grande Antigua resort and the Sandals corporate office in Miami, but has not received a response.
This is the reality of what the decision by Sandals to close in the busiest time of the Industry means to an actual guest. Couples have been laying the blame where it belongs firmly at the feet of Sandals. I again quote from the UK article in the Daily Mail.
“Tearful brides-to-be are among hundreds of holidaymakers forced to cancel their trips following the shock closure of one of the biggest all-inclusive resorts in the Caribbean”
Thursday, Jul 27th 2017 11AM 29°C
Tearful brides-to-be are among hundreds of holidaymakers forced to cancel their trips following the shock closure of one of the biggest all-inclusive resorts in the Caribbean
- Holidaymakers have been left devastated after Sandals in Antigua closes down
- Hundreds of tourists and wedding parties will need to find a new location to stay
- Bride Sharon Osborne was in tears after finding out the sudden decision to close
- The scenic resort is to close from September 20 for three months for renovations
Hundreds of holidaymakers – including many devastated wedding parties – have been left high and dry after one of the biggest all-inclusive resorts in the Caribbean announced an unexpected shutdown.
The Sandals resort in Antigua has left brides in tears following its sudden decision to close for three months from September 20.
Tourists have been forced to cancel their holidays, having spent thousands of pounds to book their trips.
Among them are British couple Mark Ingham and Sharon Osborne, both 55, who had planned to wed among the palm trees of the Sandals Grande Antigua resort on September 21.
But last week they were told their wedding was off.
These headlines have not just damaged Sandal’s brand but they have also affected Antigua and Barbuda, which has an excellent reputation in the industry as a Wedding and Honeymoon destination. Mr. Speaker
Antigua and Barbuda must maintain it Honeymoon Market Value
This debacle has prompted both the Ministry and the Tourism Authority and the AHTA to work together to reach out to these couples and try to salvage their vacation plans, not in another Sandals island, but right here in Antigua and Barbuda! We will do what we need to do to turn the tears of these brides to be into smiles of Joy!
We have been voted by the industry for two years in a row as the Caribbean’s most romantic Wedding and Honeymoon destination and in order to protect that we will be work with our other hotels to safeguard those weddings that have been affected by this closure.
To reiterate what the Honourable Prime Minister said As a Government and Ministry of Tourism we must show that we care. We will be reaching out to all those couples affected by this closure, who have booked and paid for their destination weddings. For those who would still like to be married in Antigua and Barbuda, the Government will make a contribution to their hotel package to allow this to happen at another property of their choice on island. We will show to the industry that we are not only saying we are committed to our guests but we will show it!
This is a case of déjà vu; we have been down this road before.
Just as in 2002 I stood up to be counted when Ms. Querard of the Half Moon Bay holdings sought to fight the Government in protecting the People’s patrimony, I will stand up today. Back then that property had enjoyed tax-free holiday and concessions for 24 years, and made money as one of the premier resorts in the country. Over this period they had not paid a red cent in contribution to the Treasury.
Back then we did not allow any one individual to subvert the wishes of the Government and people and the same is true today.
Please permit me to refer to a “Fan the flame” article
by the late great Tim Hector entitled the The Black Condition, here and now February 8, 2002
which quoted me back then
“On a ridiculous conservative estimate, if we say that the government gave them [HMB Holdings] only US$100,000 a year for 36 years in tax holidays and duty free concessions, the people of this country have US$36 million invested in that property. And to the US$36 million, which is EC$97 million, we have to add the land which they got for free!” [Hold the word “ridiculous” in your head for a moment and its meaning will become fully clear about nine paragraphs from here].
As yet, I have not added all the years of duty free concessions on all the equipment and fixtures in the hotel and everything else that is used.
“But, we know, Madam President, that the figure of US$100,000 a year that I have used here is ridiculous. The taxes would have been much more than that. The truth is that the total figure in tax holidays and duty free concessions is close to US$200 million.
“Just think how many hotels we could have built with that money instead of putting it into the pockets of the shareholders of a single company, HMB Holdings.
“The people of this country were very generous, very generous indeed.”
In plain terms, we are as generously foolish, as the natives, who sold Manhattan for a string of beads. At any rate the natives who sold Manhattan had a cultural value on a string of beads. What can we say of us blacks here?
Again the non-black speaking in the Senate on January 25, 2002 – a date, which ought to be rated as important in our annals, asked the relevant question:
“And what did we ask in return? What did we ask HMB Holdings to do in return for this great generosity of the Antiguan and Barbudan people? We asked nothing more than they keep the hotel open and provide some of our people with jobs!
“In the meantime, they shipped large profits out of the country year after year, from 1971. We never charged them a cent in taxes. Not in income tax, not in consumption tax, not in withholding tax. They got it all for free.”
Consider the phrase ‘they shipped large profits out of the country”. What else has been happening here since 1632, when Edward Warner conquered the natives of Antigua & Barbuda, and took possession of the island in the name of the King and Queen of England? 1632 to the present, same essential condition. Dispossession. Only this time it is the natives who are upholding, defending with might and main, with verbal thunderbolts, or radio Talk Shows this “ridiculous” condition – The Black Condition, here and now.
The record requires me to say, that the speaker in the Senate, who spoke these words, the non-black was none other than Senator Asot Michael, a non-black, Lebanese in origin, Antiguan and Barbudan by choice.
It sounds familiar doesn’t it? Well just as we prevailed back then, the Government and people of Antigua and Barbuda will prevail again. We will stand up to be counted for our people!
Mr. Speaker, the old article continues to quote
That is, that all of our politics, all of our economics, all of our social existence, rather, our social histrionics, is predicated upon allowing whites to own and control all the essential avenues of life and living here. And, once they don’t make it too obvious that we can’t go in dey, can’t siddung dey, and don’t ask us to ride in the back of the bus – we go to the back as if by inferior nature so ordained – and don’t call us ‘nigger’ with insulting intent – we proclaim that all is well, and, indeed, we never had it so good. And to crown it all, we proclaim the absolute myth, “here every creed and race find an equal place, and may God bless our nation; where each endeavour and all achieve; and so out of many, one people; classless and free.”
By a process more ancient than alchemy, and more persistent than poverty we turn our historic dispossession, into it’s opposite – freedom. We proclaim by national slogan and billboard that “Tourism is in our hands”, when it is they who are shipping away the millions from our labour and underdeveloping us. And this process of enduring, albeit eternal underdevelopment of ourselves, we declare to be “freedom”, when freedom can only be the opposite, namely the free and full development of the individual, of her and his natural acquired abilities through social ownership and control.
I was attacked back then in the media for referring to Ms Querard as a “White Woman” and an enemy of the state” and Mr. Leonard Tim Hector like a true patriot came to my defense, and I was later vindicated by the white Law Lords of the Privy Council. But Mr. Hector had this to say back in 2002 and I quote.
Whether one likes him or not, Senator Asot Michael, had the courage and the requisite passion, in an impassioned speech, to tell the nation of Antigua and Barbuda like it is. And the TV tape of that occasion should be kept in the national archives. It may prove a defining moment. Remember no government leader has ever said the like here in 35 years of self-government. Only one political party, ACLM, still in the wilderness of the damned, has ever said that and more. In a very definite way Senator Asot Michael passionately indicted what has passed for politics here, by his recurring reference to “for 36 years.” The thirty-five years of self government, have been in essence the same as the preceding year, and the preceding 364 years back to 1632.
I am not done yet. In the minds of the hoity-toity black elite – and commoners have followed where they thought their betters led – Asot Michael’s reference to Ms Querard, majority owner of Half Moon Bay Hotel as “a white woman” or as “this white woman” was regarded as blasphemy, if not undiluted racism.
In this hysterical situation the “state compulsorily acquiring at market value” a white-owned asset, was twisted and distorted into a “seizure” by commonplace and mindless black DJ’s posing as “commentators” and “analysts”. They wished to alarm the world that a “heresy”, a “blasphemy”, a “sedition” was occurring in Antigua and Barbuda, “the seizure of white property,” which, incidentally, has “not paid a red cent” to the public treasury “in income tax, in corporation tax, in withholding tax, in consumption tax, in customs duties” for all 36 years of its corporate existence. That, for sure, makes it a little worse than Enron.
In short, any questioning of White Power here, even by a non-black is regarded as blasphemy.
Tim Hector continued
At any rate, people here were calling for the death, the political death of Asot Michael for saying this “white woman” or for making other than not so complimentary remarks about “the white woman” who has exacerbated our dispossessed conditions by not paying a red cent into the Treasury, while enjoying lavish concessions from the State for decades. Asot Michael by challenging white power made an imperishable claim to be considered a legitimate heir of the one and only Father of the Nation – King Court.
Today we must protect our people and their patrimony by ensuring our Tourism is firmly in our hands. We are seeking to pass an amendment that ensures that when concessions are granted by the Government and People of Antigua and Barbuda we have an inalienable right to expect that the company that has been given concessions will live up to their part of the bargain!
It is an issue of National importance and a landmark piece of legislation to protect the very industry, which is the lifeblood our nation.