A column by Jan Van Nes
Interesting post by Jan van Nes, on his Facebook wall, so I am ripping it off, because Jan has the finger on the pulse, as a self-employed entrepreneur: Asi es Mi Peru, and the Kitchen Table by White restaurants.
Jan goes on to explain that 40 years ago he started in tourism at the Talk of The Town hotel as a dishwasher, and worked with some titans of industry among them hotelier Ewald Biemans. He went on to graduate an excellent hotel school in the Netherlands, and furthered his career working alongside other food & beverage greats, oozing talent and passion. They could debone a Dover sole perfectly, prepare an elegant Caesar salad, or flame a spectacular cherry jubilee tableside, with one hand tied around their backs!
Best of all he doesn’t remember the phenomenon of AO, absenteeism, in those days.
Fast forward forty years, we have a booming tourism industry and the generation of the 70s that used to bring visitors home, and forge genuine relationships with tourists is getting ready to retire, or is already fishing.
While the island is more than ever dependent on tourism, apparently, the skills of that 70s generation were not handed down to the millennials, and as it turns out, they have much less interest in hard work, let alone in tourism.
So, the industry complains about a lack of capable hands, and on the other hand many parents lament that their kids get no opportunity to enter the job market and are threatened by cheap imported labor. With a few thousand of hotel rooms in the pipeline, Jan wonders how those workplaces will be filled. He also states that for every person complaining that there is no work to be had, a businessman in dire need of enthusiastic employees with positive attitudes, is yearning for people that will not go AO, on their first week of work – a rarity in the culture of this new generation.
Because work permits are hard to get, at the end of the day, Jan feels that service suffers, and value for money is hard to find. And visitors, he adds, are questioning every day, the value of Aruba, in light of it getting more expensive by the day.
Of course, expensive would be acceptable if and when we deliver on our promises, he says.
He ends the post stating that crying is not the solution, and that all stakeholders must participate in a dialogue, leading to concrete solutions.
He likens our tourism industry to a family business, founded by grandpa, expanded by members of the second generation, and neglected and ignored by the third, and he is hoping our story would be different, calling for stakeholders to step in, otherwise the island would need a new game plan, he opines.
Moratorium on new supermarkets
You will like this column, it is filled with common sense.
Apparently the MinFEC, Finance, Economy and Culture, extended the moratorium on supermarkets that was about to expire on May 23rd, 2019, and extended it by two years.
Just in time, before a new wave of markets floods us, her office conducted a survey on Facebook, and this is what they found.
The number of markets on the island:
Noord/Tanki Leendert 36
Oranjestad – West 39
Oranjestad – East 39
Santa Cruz 16
San Nicholas – Noord 10
San Nicholas – South 8
Total 187 markets on Aruba.
In total 1,800 people were surveyed and 94% were of the opinion that we have too many markets here, and 74.5% indicated that there is no room for growth in this sector.
And that means that in the next two years, there will be no permits given for mini market/supermarkets in any of our barrios.
NEXT: Hardware stores, please. I want to see a survey and a moratorium on hardware stores, then food trucks?
Most of the Chinese owned supermarkets in Aruba look the same, and carry the identical products. Their traditional architecture with the tile façade, steel bars, and porcelain dragons or lions, in addition to traditional interiors are very similar and they all have traditional Chinese names.
I have read that while many of them are started and operated by immigrant entrepreneurs and their families, the knowhow, and the startup cash comes from investors of existing corporate conglomerates already headquartered in China, and Hong Kong etc.
These conglomerates have a global network of small grocery stores, and they have taken the local food shopping experience over. It is safe to say that the Chinese grocery sector has taken the local food shopping here over, while the tourist grocery sector is dominated by just 1 perhaps 2 players.
For the small neighborhood stores, the business opportunity is perhaps unexciting, and same-old – though I did hear that many of these establishments dabbled in alternative markets from gambling to contraband – the real estate will however over time prove to be a smart investment, for whichever conglomerate that owns it.
Smoking Ban, enacted by the public, even before its official endorsement
Would you believe, we got behind the law even before it was ratified.
So, in principle, we didn’t have to stop smoking in public places, but we did because it is the right thing to do.
Over the past few years I wrote a number of times about laws that passed in Parliament but were never enacted.
One example would be our Civil Code, a book of 1,000 pages, at least, governing everything from mortgages to marriages, but the ratification was delayed, because of an itsy-bitsy piece of legislation regarding same sex marriage that was traded in for living together, that held up the whole process, because reportedly, we still have some old-fashioned folks living among us who should not be ‘offended.’
We are all waiting for the Civil Code to be published, it will modernize many aspects of our life on the island.
Basically, laws are passed by parliament, published, then they become enforceable.
Sometimes parliament passes a legal framework, and then the experts go to work to further define and clarify. In light of the fact that the government has set a goal to reduce the use of tobacco, prevent non-communicable diseases, and increase life expectancy, legal minds are now filling in the blanks regarding the Smoking Ban, where, when, how, and regarding the Sale of Tobacco, when, where, how.
They follow a World Health Organization’s model, under the MPOWER, acronym: Monitor, (use and policies), Protect (people), Offer (help), Warn (of dangers), Enforce (bans), Raise (related taxes).
So, prepare for an extensive publication specifying all restrictions, including advertising.
One of my lawyer friends, elaborates regarding the ratification of laws: According to him, some laws are passed, published, and enacted, but still the public doesn’t really give a damn, and bad behavior continues. We have many examples for that, including littering, nature destruction, illegal parking, illegal construction, and a million other things.
The State, as in the POLICE, cannot control and enforce every single aspect of civilized society, we must rely on the goodwill of citizens and their genuine desire to live in a law-abiding society, obeying the does and don’t.
Above all, stop smoking,
A THREE-TAX SYSTEM for Aruba
In a recent AHATA meeting the good people from EY, among them Senior Manager Tax, Mireille de Miranda, updated the interested forum about the recent tax reform, starting with Ground Tax.
What you should also know:
The 60k exemption and the 0.4% rate are gone, and the new formalities include an added filing. In the event that you renovate, demolish, or change the property’s designation, you are required to report to GOA that you just upgraded the real estate, thus you become eligible for a new assessment, higher, imposed the following year. Failing to report any construction and rise in property value may result in 100% fine!
So, beside the song and dance with the notary, and the song and dance with DIP for building permits, you are also required to fill in another set of papers for another GOA department filing, regarding the same exact project.
Basically, you buy a piece of property, settle all back-taxes, yours and the seller’s, the deed is passed, money changes hands, you file for renovations, you go through hell and back getting the project off the ground, then you have to file the new look with GOA and wait for their refreshed assessment, chop-chop, within two months.
Following this new twist, I spoke to one of my tax-expert friends, outside the EY circle.
He expressed his total frustration with the slow pace of the much-awaited tax reform, and stated there are just too many taxes to keep up with, and the bureaucracy is killing business.
According to him, Aruba would require just THREE taxes, the rest can be abolished, nixed, eradicated.
Import duties: Goa’s main source of income, tax everything at the gate. Easy to control, it either comes in by ship or by plane, onetime STEEP levy. Move a handful of the 400 tax department employees to Barcadera, place some at the airport, and re-assign, the rest.
Tourist Tax: Continue to levy a destination fee on all room revenues paid by visitors.
Tax Dividends paid to foreign companies doing business here: Collect a tax on all moneys earned by the resorts, or any foreign company, even if it never enters Aruba, and it is not difficult to track, since it is all recorded.
So basically, GOA gets import duties, we, the humble citizens pay more for ‘things,’ but we have NO income tax, and our employer can pay us more because he is NOT burdened by social benefits. We make more money? We spend it all in the local economy.
And the Import Duties levied pay for everything, AZV, trash collection, education, flower arrangements for GOA’s offices.
Did you run the numbers, I asked? No, he said, but many of my tax consultant friends support the idea, though it will take them out of business, with just a THREE TAX system all tax consultants will become redundant. So that’s good news.
A storm in a Vodka cup
Apparently, Forbes.com is well read on the island because before 8am, yesterday, my friends were already buzzing about a Forbes article quoting the recent increases on excise duties. The article made it sound like a MONUMENTAL price increase, because of the way the MINFEC wrote the Wijzigingen invoerrechten en accijnzen, “sin taxes,” decree.
The increase was quoted as a raise from AWG 400 to AWG 433 per hectoliter, which means on 100 litters. Hello?! Awg 33 raise, spread over 133 bottles of 0.75Lt.
Really? Is that what the fuss is all about?! If a bottle of wine costs AWG 20, the tax on that bottle was Awg 3, and now it’s Awg 3.25, a twenty-five cents increase. Not a big deal.
Ok, I admit, I also did not understand that at first.
But now I know, that if you buy a very expensive French wine, or some bottled dish water the tax remains the same, based on volume not value.
The more significant increases were levied on bum wines, on Night Train and Thunderbird, those flavored fortified wines, which are favored by chollers, because they were inexpensive and loaded with alcohol.
The street people will now pay more for their poison!
Why did you pick the chollers as your target market for the increase??
I spoke to some of the wine and spirit purveyors, they are all mad, because much of the decree makes no sense.
The policy is discriminatory against St Nicolas residents, those who favor stout beer, especially Guinness. Yes, Guinness is now more expensive. And it is mostly consumed in St Nicolas.
The purveyor thought the MINFEC did not know the difference between Lager, amber colored beer and Stout, dark colored beer, because the decree singled out stout and left all other beers out.
Also, those who roll their own cigarettes will now pay more. For the value sensitive consumers, Shag is now more expensive. Phillip Morris may win more customers over to the already-rolled varieties.
I also heard that our accijnzen are higher than Curacao
AND that the IMF advised AGAINST the increase in ‘sin taxes.’ The IMF recommended tax hikes for plastic imports, and oil fuel, BUT MOSTLY recommended the institution of VAT, as a better fix for our ailing economy.
One purveyor explained to me that the increase took the bottle of Absolut Vodka, for example, from Awg 23 to Awg 33, which means Awg 2 per shot. (17 shots per bottle)
I asked a hotelier will he be raising his prices. Yes, he said, modestly.
Another said: There may be abuses following the change in the law, it happened with the BBO increase too, a couple of cents make NO difference for us, we will have ZERO increase, we want to give our customers quality!
In danger of losing our international beach tennis event
Last year, the Beach Police announced to BTA, Beach Tennis Aruba, that the Aruba Beach Tennis Open, ABTO, in 2018, was the last time the event took place on Eagle Beach, and that it would have to relocate to Bushiri.
BTA did not object. They wrapped up Aruba’s most successful Beach Tennis competition, with 1,400 players, on 38 courts, with at least 4,000 spectators over the weekend, and were hopeful that Bushiri will be ready.
What does ‘ready’ mean? In order to run a beach tennis tournament, the beach at Bushiri would require 40cm of white, sifted sand, over 24,000 square meters, which amounts to about Awg 300.000 in sand alone, and at the moment Barcadera has no stock, thus, Bushiri will probably NOT be ready to receive players and fans in November 2019.
Beach Tennis has been growing on the island. It is a much-loved sport, and as an international event, it is a welcome alternative to music concerts.
The 2018 tournament impressed an international TV producer greatly, and he was coming back in 2019 with a crew to film it; the International Tennis Federation, ITF, was about to grant the Aruba event the WORLD CHAMPIONSHIP title.
Things were looking up, and BTA got more excited by the minute, and applied for the 2019 permit. Sport Tourism is good for the island, it has ATA’s blessing, so they waited holding their breath. Will the event be given a permit? Yes? No?
And if yes, where? Eagle Beach?
Apparently, the island’s much-talked-about Beach Policy states that there CANNOT be any more events on the beach.
But how can you host an international Beach Tennis competition off the beach??
In Brazil and in the Netherlands, authorities wrestled with that same conservation issue and found a creative solution by making these beach volleyball and tennis events synonymous with cleanups. Every bottle cap and cigarette butt are picked off the beach before and after, with up to 120 squeaky-clean courts offering sport & entertainment value.
According to BTA, in 2018, they conducted a cleaning before, while and after, and handed the beach back to the Beach Police in better shape than ever. The area between La Quinta to Paradise, that never gets any TLC, was scoured by BTA to pristine condition.
Time is running out. It’s February. No permit on the horizon. BTA asked for a meeting with the MINInfra, I heard it was finally granted. Meanwhile ITF gave the WC title to Italy. The producer is still interested, but needs to have a confirmed timetable. Players are hungry for information.
What’s gonna happen? BTA says it’s go big or die. They will not shrink the event to fit into the Tropicana Beach Tennis Club with just 16 courts.
The saw ABTO grow over the years, and want to continue nurturing its trajectory.