BRATISLAVA, Oct.23 (Xinhua) -- The reduction of the value-added tax (VAT) to 10 percent on accommodation services will support the development in regions and increase employment. Slovak parliamentary chair leader Andrej Danko stressed in a statement on Tuesday.
The parliamentary plenum approved an amendment to the VAT Act, which reduces the tax on accommodation services to 10 percent since January 2019. "It will be again a systemic and targeted support for domestic tourism as well as the spa industry," pointed out Danko.
The Slovak Hotels and Restaurants Association (AHRS) welcomes the decision.
"The VAT reduction comes literally at the last minute as tourism would start to stagnate without such support, due to constantly increasing costs and visitors' pressure concerning the quality of services," expressed AHRS general manager Marek Harbulak.
According to Harbulak, accommodation services are labour-intensive, while salaries in this segment are among the lowest in the Slovak economy in the long term. This was caused by a high tax burden, according to the association.
"The experience from European countries confirms that lower VAT strengthens job creation, salary growth and brings new investments not only in the hotel industry but also in other tourism services. We believe that in a short time we'll convince MPs about the need to reduce VAT on food services," added Harbulak.
