Money rolling in the street, GOA just has to pick it up
Condominium projects are important for the economy, especially in times of crisis. Why? Condos never close, they always have owners, and they host a mix of long term renters and transient guests. During CoVid19 the condos complexes in Aruba suffered few layoffs.
The timeshare industry is another good one. Owners and repeat guests will be among the first ones to return to Aruba while hotels and other accommodations are still thinking about it. Aruba has been through challenging times before, and with the help of the condo-hotels, the timeshares and the vacation home rentals, the island will get back on its feet much faster than you think.
A recent poll by Magna Global in the US suggested that after travel restrictions are lifted tourists would prefer to book and feel safer staying in the privacy of a vacation home, away from busier, crowded accommodations.
A Few Facts
The vacation rental industry is a US$ 140 plus BILLION market and growing worldwide at an accelerated pace with the likes of Airbnb, VRBO and Bookings.com, in the race. Vacation Rentals cater mainly to millennials and families which will contribute to rejuvenate Aruba’s mature product. Given its huge potential, hotel brands such as Marriott (Home & Villas by Marriott), Wyndham and Accor are entering the market, as well.
Expedia didn’t pay $3.9 billion to acquire VRBO and Homeaway, for nothing.
In keeping with Aruba’s vision of attracting more affluent tourists to sustain steady economic growth, vacation homes provide visitors with an alternative to traditional lodging offered in tourism-based economies. This type of client is looking for a family-oriented feel, a more “homey” and tranquil environment away from waiting in lines and crowds at the big properties, wishing to also experience the island’s culture.
Moreover, the literature on vacation homes suggests that tourism is the catalyst that drives the second-home market.
It also becomes important to ask if tourists who rent homes/condos would have come to Aruba as visitors if the vacation rental market hadn’t existed??!!
Most likely they would go somewhere else.
We have to remember that hundreds of Arubans families supplement their monthly income and pay their mortgages hosting guests in their 2nd home or annex. VHRs tourism revenues have the power to trickle down to LOCALS and do not only remain in a few (foreign) hands. That extra income helps many locals survive challenging times.
HOWEVER, the VHR industry must have a level playing field and everyone must be made to pay room taxes OR be denied the privilege of renting out.
Just in room taxes alone, vacation rentals could generate close to AWG 20 million for GOA.
Blue Aruba Rentals share the concerns expressed by AHATA and others, over equity and fairness in regards to lodging establishments and VHRs.
We believe this industry should be regulated, not over regulated, but regulated enough, so that players abide by the law and pay the room tax and environmental fees, as dictated by law.
We unfortunately fear, that most vacation rentals on the island are not paying their taxes.
Enforcement is the weak link.
GOA’s Departamento di Impuesto, DI, should enforce the decree enacted in July 2018.
Because besides GOA’s lost revenue this delivers an additional negative consequence, as the companies complying with the law lose clients to the ones not paying their taxes, and discounting rates instead.
The attractive 9.5% discount plus $3 a day, creates an incentive for clients to book, and for the VHR not to charge, leaving GOA out of the equation.
The good news is that the solution is not complicated; and based on comparable tourist destinations, it only takes two/three capable persons at Departamento di Impuesto, DI, to control room tax evasions/compliance.
For example, the town of Breckenridge, Colorado with a vacation rental market the size of Aruba, has a 99% compliance rate in part due to a dedicated two-person enforcement team. With a smaller VHR pool and local knowledge of tracking listings-photo locations, properties can be easily recognized and taxes.
SOME IDEAS @impuestoaruba
Improve enforcement by Departamento di Impuesto, DI. They should focus first on the big players (realtors/condos/rental and property managers) and accommodations on hosting sites.
Airbnb is already collecting room tax on vacations in Amsterdam rentals as well as many other cities throughout the world. Former Minister of Finance Angel Bermudez and the Aruba Tourism Authority already signed an MOU with Airbnb, twice, and were working to reach a similar agreement, years ago, but it never materialized.
Monitor the big online travel agents (OTAs) in the VHR market (Airbnb, VRBO, Bookings.com, Expedia, etc.) in addition to controlling the big players in Aruba, you would have over 80% of the vacation rental room tax collection challenges solved.
Have hosting sites display lodging permit numbers on their listings for easier monitoring by Departamento di Impuesto, DI.
Enact a new law for vacation rentals and thus leave no room for misinterpretation, because vacation rentals regulations were incorporated into the law designed to regulate all-inclusive hotels, last minute, and there is no separate legislation.
– A level playing field for Hotels, VHRs, and Timeshares, is required. Timeshares should also pay room tax when renting to transient guests. As a matter of fact, timeshares are a big player in the VHR business but with a 9.5% price, plus $3 a day advantage!
By the way, that is easy to collect, because players like Marriott, Costa Linda, Playa Linda, Divi, etc., are reliable companies that will comply immediately.
– The new law should include responsibilities/norms for OTAs to operate in the Aruba market.
– Co-responsibility for paying taxes should be on the owner of the property as in the current law, AND also on the rental manager, or management company, if collecting rental revenues.
– Establish minimum standards for obtaining a lodging permit.
Decisions on regulation shall not be based on a particular sector’s interest, but just on its contribution to the larger economy and well-being of ALL tourism stakeholders and that of the Aruban people. More so in these dire times.
If well managed, in just a few years the VHR industry could contribute more revenue to Aruba than the Cruise industry, and perhaps replace it
Alberto Perret Gentil
Pering Group/BlueAruba Rentals
The Kettle Calling the Cat Black
Aruba Nu, a website with news about Aruba, in seven languages including simplified Chinese, reported on the activities of the Nos Ta Aruba Foundation recently, stating that it addressed a letter to the Aruban Public Prosecution Service, OM, listing nine possible offenses against former-minister Otmar Oduber, and six satellite associates, accusing them of criminal acts of corruption, abuse of power, self-benefit, self-enrichment, bribe taking, tax evasion, money laundering and the creation and participation in a criminal organization. That’s a mouthful.
The hoopla started earlier this week when MinJust declared to the press he was not paying the former minister who is the head of the POR party represented by MinJust in the coalition, an advisor’s fee via his ministry. I heard a dissonant in that declaration but did not understand it, now I know, there was a report coming down the pipeline with hefty accusations, and the MinJust wanted to steer clean.
Before you go out to buy streamers, cake and champagne, you should know it all depend on the decision of the prosecutor. We need to sit back and wait. Let’s see if he wants to go down that Rabbit Hole, probably as expensive and as tedious as the Ibis and the Ostrich cases. I even thought about potential ugly bird names for the proceedings, Caso Koning Vulture? Or Caso Kalkoen? Which would you prefer.
Anyway, sit tight, let’s see, if there is an appetite for digging into the minister’s life-style and his Carnival group accounting, beside land deals and the Aruba logo proceeds. In the past quite some dirt was slung around the minister, but nothing stuck. He might be Teflon-coated.
A few things come to my mind.
The former minister, no doubt has a dark side to him, which is regrettable, because with his energy and drive he could have been good for Aruba.
His final, hurricane-force reorganization/looting of Serlimar, left us all high and dry and the crippled company in mega debt. It accomplished ZERO for the country. And I will not go further into the above laundry list, let the experts tackle it.
I found three names behind Nos Ta Aruba Foundation, not registered at KVK, Jan de Ruijter, Leo Croes and Alfred M.G. Williams. I wouldn’t call that good company.
Jan de Ruijter, no doubt a tourism pioneer, his later years’ activities, put his earlier accomplishments to shame.
Michael Williams, he’s among the island’s premier bottom-feeders, a delusional instigator, always posturing as a well-connected mover and shaker, all for personal gain. And I am talking from personal experience: I remember during the La Cabana Beach & Racquet Club bankruptcy, the crooked curator conspired to develop a pier and a sizeable promenade with cafes and shops on Eagle Beach secretly flaunting the ace up his sleeve, Williams’ excellent ‘connections’ with the AVP government, literally sliding the deal into his pocket.
Leo Croes? I am not sure, but show me who your friends are and I will tell you who you are.
Perhaps Nos Ta Aruba Foundation is the instrument to again bring down some untouchables, and expose ugliness, perhaps not. A lot depends on whether OM will find enough cause to investigate based solely on the documents presented. If those don’t build a case for corruption, there will be no ground for further investigation. So, let’s not hold our breath.
GAME CHANGER? Dutch parliamentarian Andre Bosman added his political weight to the stew with a well-documented case of a badly-handled impending calamity at the Bubali water treatment plant, where the former-minister made sure the wife of a certain news ferret raportero was blocked from transfer to another department, and fired. That was the highlight of his stint at the helm. It accomplished ZERO for the country.
I also thought it was a mistake to clump the former-minister with six satellite associates. It might scare OM off, being too much, too broad, too all-encompassing. Or it might take too long to investigate with conclusions coming long after everyone’s interest has died.
An overthrow should focus on just one subject, when it bundles many different heads together, it becomes too big to handle, too complex.
I can hear OM saying, not tonight Josephine, I am exhausted just thinking about it.
The only thing sure is the brave lawyer who drafted the legal papers, he will never get any work from GOA, or Aruba Airlines, or the Hyatt Place or the Village on Palm Beach, or Wine & Dine or the Aruba Private Airport, Fast Delivery, Tierra De Sol, Deloitte, South Beach Center, the reported new boutique hotel at APA’s wharf or Finance Quest.
Me and Padrino under the tree
Do you want a therapy-session with Padrino, asked one of my superwoman girlfriends who volunteers at Fay’s Ranch to walk the resident, retired trail horses, on the border of Arikok park?
Sure, I will try anything, I said.
Seriously, she said, he forms a strong connection with his patients, gently inhaling the bad energy and the noise from their aura and releasing it into nature to be cleansed, and refreshed. You will feel an immediate atavistic bond with his warm breath, soft muzzle, and the little brrrr sounds he makes when he lifts the invisible weight off your shoulders and hands it back to the universe.
The massage table was placed under a tree, in the shade, so I could lie down comfortably, at Padrino’s chest level. The place is a garden of Eden of the deserty kind, in need of rain, but gorgeous. Tall cactus, loud birds, the fully rested and recuperated post-covid19 national park is peaceful and alive.
Padrino, a 17-year-old therapy-horse, is elegant and muscular with a sculpted chest and a crest of long chestnut brown hair, arched eyebrows, big round eyes, a slightly indented muzzle with prickly black bristle-like hair. I know all that because he placed his head above mine, and serenely inspected my neck, my forehead, my chest.
I felt his bristles tickle. His breath came to me like intermittent streams of warm, sweet air. He extended his lips to carefully taste my tee-shirt.
In horse-language that means relax. Then he clacked his chicklet teeth. He was releasing the clutter in my head.
You have to let go, he said.
I opened my eyes.
He was talking to me. I heard it clearly, as the day is long.
But Padrino, I whispered, the teachers at Colegio are under immense board-pressure, where is their capable and experienced rector? Why doesn’t the universe provide them with one? Teachers aren’t supported, they are in conflict with the board.
It’s all buzzing incessantly in my head
And the doctor who lost 4,000 pap tests at the hospital‘s central lab is still a free person
And they are building illegally in Savaneta, bungalows on the water, with above ground septic tanks, cutting the mangroves down
And Sada, Simar and Spa, show zero goodwill, sticking to their traditional opposition roles instead of understanding
And there is poverty in Aruba, hundreds of unwed young mothers with babies and no resources
And we have no PG, no General Prosecutor, to investigate potential white-collar crimes… and 2,000 more rooms will be added to the mix, within the next years, we need those like a hole in our head.
I paused, the avalanche. And this is my list from just one day, I whimpered.
Brrrr…. Padrino uttered and rubbed his hind hoofs together.
He wants you to roll over, said superwoman.
I did. I couldn’t wait what he had to say.
Padrino went quiet for a while, his breath came to me like intermittent streams of warm, sweet air. Then he told me, there was just too much going on in my noodle. These are all opportunities for improvement and change, he explained, nothing is forever, it all ebbs and flows and today’s disaster is tomorrow’s vague recollection, do what you can, he said, and the universe will take care of the rest.
Faith, my child, he sighed, you need to have more faith.
In SN with Ajudo Na Aruba
Last Tuesday I showed up at Cumana 78L for a day of food home-delivery in San Nicolas. The place was buzzing with volunteers in red shirts, they had prepared all customized boxes earlier in the morning, for the crew of volunteer drivers to hit the road midday.
Spaghetti, some chicken, a piece of pumpkin, fresh bread, coffee, sugar, cup a soup, Maggy’s cubes, potatoes, green pepper, crackers, the boxes were nicely filled, a few households also received neatly folded clothes, baby formula & diapers, according to their specific needs, larger boxes for larger households.
I was assigned 8 addresses in San Nicolas some around Lago Heights, some in town, compliments to WAZE, that had every nook mapped, and made it easy to get around.
J., a skinny, intelligent and well-spoken mother of three, worked at La Cabana as a contractor, she was hoping to go back to work soon, she wanted to have her kids early, she explained as a toddler in underwear squeezed through the ancient door to see the visitors. They are a total of ten in the household, and the place is falling apart.
Africa. Darfur. The area behind Lago Heights looks like Africa, lots of trash strewn around, abandoned structures, dust and plastic everywhere, no roads. The crumbling, peeling, cracking homes have boards for doors and windows.
M., a young mother of two, super friendly and eloquent, her mom owns a small food outlet in San Nicolas and she helps out there, but the place just opened and is tucked away and difficult to find. She lives in a gated cardboard complex, on a paved road, a deluxe accommodation in comparison to her neighbors to the north, with a toddler and a baby who relies on Ajudo Na Aruba for formula.
Z., an almost toothless kind woman, worked for Barcelo as a contractor and was let go, hoping to recover her position once the island opens. With seven people in the household things aren’t always easy. Her husband still works at a security man, which helped their situation.
The people we met were gracious and sweet. There is no shame in being poor when the whole country is suffering, and they told me their stories patiently, they were all hopeful.
Ajudo Na Aruba focuses on families with kids, especially single parent families, which was the common denominator of all homes we visited, all young women, burdened by a number of kids, with just a few men around, and they were sleeping when we knocked on the door.
Where are the men, I asked? Don’t they have any sense of responsibility, where did they go? And who raises these men, who walk away from their children? It’s us women.
We raise them like princes, to be worshiped and adored. Then what?
The CBS published some numbers this week, regarding subsistence level: The subsistence level for a household consisting of two (2) adults and two (2) children (aged 0-14 years) in April 2020 is Afl. 5,002, an increase of Afl. 93 compared to April 2019 (Afl. 4,909). The subsistence level for a single adult household is Afl. 2,382, an increase of Afl. 44 compared to April 2019 (Afl. 2,338).
Core inflation excluding the effect of energy and food – was 4.3% in April 2020. The energy index – which consists of the products: electricity, water, gasoline and diesel – was 2.1%. The food index showed an increase of 12.1%.
About Ajudo Na Aruba: Founders Annelot and Teddy now feed up to 1,000 people a week, having started a grassroots organization Ajudo na Aruba.
Please show them you care. This is a two-girl operation, no overhead, 100% of the products you deliver/donate go to the new poor, those who lost their jobs mid-March, those who were making beds, flipping burgers, and washing dishes in our tourist sector, many illegal, many single-parent families, 60% living around Savaneta and San Nicholas.
Ajudo na Aruba helps the bottom rung, those who get zero help from nobody, supporting small children, out of work, unqualified for subsidy or pension.
If you are reading this column, you must make a donation:
Aruba Bank #2211730390 Pemaxawo NV Sero Biento 23;
NL96 RABO 0110527887 ovv Ajudo na Aruba
He said, she said
Yesterday was a total waste of time, a day sinberguenza
Now is the time for a COLLECTIVE SENSE OF PURPOSE, and what we got yesterday from the gentlemen at the helm of the POR party was a shitshow of the tallest order.
Our tiny island is in crisis on so many levels, and they just decided to add wood to the fire, add chaos, to insanity.
Gentlemen: You are as immature and petulant as the King-Baby in the white house.
You should be taking a page out of Mark Rutte’s book instead of looking at Trump for a role model.
WHY? Why Now?
That’s of course an unanswered question, besides the obvious: The current MinInfra started cleaning up the mess left behind by the former MinInfra, and greatly disturbed the hive.
In Aruba, no good deed goes unpunished.
She was working, moving in the right direction, but the so-called retired puppet-master didn’t like it.
He must be a ventriloquist, because I saw the MinJust speaking, but I heard the former MinInfra’s voice.
So what happened you ask.
He said in a surprise press conference that she doesn’t communicate, she is too busy to meet, she closed the public road at the park for ATV/UTV traffic and she wants to suspend payments at Serlimar thereby endangering the livelihood of many. He said the ‘party’ lost confidence in her as minister of this-that-and-the-other, and they will be replacing her. She had to resign by Monday 10am
She said it was all news to her, she has been working very hard on a great number of delicate issues, and the decisions quoted as hers were in fact made by the board and management of the park and the board and management of Serlimar respectively, and she had nothing to do with that.
He said it pains him to boot her out, they are friends, they have known each other from youth, and as a born-mediator, a self-styled peacemaker, he tried his best to prevent this blow up from happening.
She said it all came to her from left field. She was at a meeting at parliament when she heard her own party was showing her the door.
Honestly, her body language and quiet outrage made her totally believable, while he was apologetic, meandering, spinning a yarn, trying very hard to convince himself, because apparently he and she are good friends, but his master made him do it.
He was just channeling his master’s voice.
He – the Minister of Justice, Security and Integration.
She – the Minister of Land Development, Infrastructure and Environment of Aruba
Where does it come from?
Not from the MEP side of the family. The MinPres was fast to announced this was an internal POR matter, she did not want any part in it.
My lawyer friends say they cannot remove the MinInfra from her job at the ministry. They can file in a motion in parliament, but that wouldn’t fly because the opposition and the independent member will abort it.
We are burdened by so many problems, and you just went ahead and created some more.
The MinPres is running a kindergarten.
And by the way, compliments to the MinPres on her excellent discourse last evening, restoring stability to education, acknowledging difficulty and promising slow-change. That was exactly what’s needed!