Cafes and hotels in Montenegro are raising prices

Way to Montenegro
17.01.2018 12:52 3256 0 2
As the CDM news portal reports, owners of cafes and hotels in Montenegro will raise prices for their services due to the increase in the value-added tax (VAT) from 19 to 21%, which came into force on 1 January 1.

The head of the tourism committee in the Chamber of Commerce and Industry of Montenegro (PKCG), Dragan Ivancevic, said that an increase in VAT by two percent was an antiturism decision as it would negatively affect the incomes of hoteliers and restaurateurs who would be forced to raise prices for their services. This, in turn, will negatively affect the competitiveness and attractiveness of Montenegro as a tourist destination.

"Due to the increase of taxes and fees in the country, hotels, inns, restaurants and cafes in Montenegro will be forced to raise prices for their services in order to be able to survive in the market." Many companies operating in the tourism industry usually work on the verge of profitability and this law, unfortunately, will lead to an increase in prices and a decrease in the competitiveness of the tourist offers of Montenegro. In addition, we will not be able to provide normal conditions for the arrival of large investors in Montenegro, so the decision to increase VAT is anti touristic ", he said in a statement Dragan Ivancevic.

The chairman of the Tourist Association of Montenegro (CTU), Zharko Radulovic, said that, due to the increase of VAT, owners of cafes, hotels and tourist firms will be forced to raise prices, but this increase should be cautious and correct. He also noted that the VAT increase will not affect everyone. "The government of Montenegro increased VAT from 19% to 21% for three- and four-star hotels, while for 5-star hotels the tax rate decreased by 7%", Radulovic said. He also noted that a tax reduction for five-star hotels, which at the moment are of very small quantity in the country, will stimulate their construction in Montenegro.

It is worth noting that the Law on increasing the value added tax (VAT) from 19 to 21% came into force on 1 January, 2018 and immediately in Montenegro there was an increase in prices for many goods and services that affect the standard of living of citizens.
 

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