VietNamNet Bridge – Travel firms have cast doubt on the efficiency of a tourism development fund and accommodation fee collection for the fund as proposed by the Ministry of Culture, Sports and Tourism.

Foreign tourists check the menu of a restaurant in Hoi An, Quang Nam Province. The Ministry of Culture, Sports and Tourism proposes collecting an accommodation fee of VND10,000-20,000 per night per international tourist

The ministry has proposed the Government establish the fund to support product development and promotion, market expansion, personnel training and operation of Vietnam’s tourism offices in foreign markets, among others.

The ministry expects the fund would have VND2-2.5 trillion after five years of establishment, with 30% of it coming from the State budget and the remainder from other sources.

The ministry proposes collecting an accommodation fee of VND10,000-20,000 per night per international tourist from hotels of three-star ranking or higher. After two years, the fee would be applicable to domestic tourists and all hotels.

Speaking to the Daily, representatives of travel firms said Vietnam’s tourism sector lacks money for promotion activities and product development and travel agencies can contribute money to these activities but transparency must be ensured.

Duong Thanh Thuy, chairwoman of Trung Thuy Group, said collecting the accommodation fee based on hotel stays is unfeasible as enterprises pay taxes on their revenues not the number of days tourists stay at their hotels. It will be reasonable when the fee is sourced from their tax payments.

Thuy said hotels dare not to ask their foreign guests to pay for the fee in the current situation.

“While the number of international visitors to Vietnam is in decline, management agencies should deploy supporting measures for enterprises instead of piling more pressure on them,” Thuy said.

Dang Huy Hai, deputy general director of New World Saigon Hotel, said no country has collected such a fee though the ministry said the fee is in line with international practices. For instance, Singapore has a substantial fund for tourism development but this fund is from part of the tax travel firms pay.  

It will be unclear if the fee collection is based on tourists’ stays at hotels. Moreover, hotels may report incorrect figures and their costs will go up if they have to pay the fee for their guests, Hai said.

The Government should use the State budget or tax revenues, or increase value-added tax (VAT) to finance the fund. But Hai noted that increasing VAT is an unwise solution as it will push up selling prices and erode competitiveness.

A businessman who used to be the general director of a luxury hotel said as the budget for tourism promotion is limited, it is necessary for firms in the sector to join hands with the Government to build up a fund for development of the sector. What matters most is how the fund will be run effectively.