Hoteliers want to be exempted from paying taxes on invoices, which will not be paid following the collapse of tour operator Thomas Cook, it emerged on Friday.
In a letter to the finance minister and the union of municipalities, employers’ federation Oev, has asked for hotels not to pay VAT and municipal tax on invoices that will not be paid because of Thomas Cook’s collapse.
“The scale of the financial cost they are called on to shoulder, especially the hotel enterprises whose clientele mainly came from the particular tour organiser, is huge for the country’s economic size,” Oev said.
Oev has also asked for an extension in the repayment of dues to the state and local authorities for at least 12 months.
Finance Minister Harris Georgiades said the government was willing to examine the issue and planned to convene a meeting soon.
“The government is ready to examine the issue, but as part of the framework set by the law,” he said.
The federation estimates the financial blow to be around 1 per cent of GDP.
The federation stressed the urgency of the situation, arguing that decisions must be taken as soon as possible to avoid unpleasant developments.
Oev called on the hoteliers to remain calm and avoid hasty actions that could affect their staff.
Hoteliers have already suggested freezing the collective agreement citing the losses suffered from the closure of the British company, thus risking industrial unrest.
Labour Minister Zeta Emilianidou has given them 15 days to make a decision on the matter, arguing that the four-year agreement was balanced.
The chairman of the hoteliers, Haris Loizides, said the immediate blow from the bankruptcy is already huge for the hotel industry, both financially, as well as in terms of tourist arrivals, since the October and November planned 45,000 seats have also been lost, and its corresponding negative impact will be added to the existing challenges that Cyprus tourism is facing, in the coming years.