VietNamNet Bridge – Due to the fact that tour operators in HCMC have found it difficult to fuel up buying power while local hotels have seen few customers, the tourism industry says it needs tax incentives from the Government to attract customers with tempting discounts in the current tough times.

The above ideas were presented in a meeting between the Vietnam National Administration of Tourism (VNAT), the HCMC Department of Culture, Sports and Tourism, tour operators, hotels, shopping service providers and transporters in HCMC on Wednesday.

The city welcomed more than 1.6 million international visitors January-May, a year-on-year surge of 7%, but the growth was lower than expected while the business situation is worsening, La Quoc Khanh, deputy director of the municipal tourism department, told the meeting.

This month, many hotels in the city welcomed few customers, with the average room occupancy rate of several four-to-five-star facilities hitting only 18-19% at certain times.

“The situation is similar to what happened in 2009, the year of the tourism sector slump,” he remarked.

Similarly, Tran The Dung, deputy director of The He Tre Tourism Company, reported a sharp fall in purchasing power at his enterprise. He told hundreds of entities and officials at the meeting that his firm was dying.

To prevent further falls in tourism demand, most entrepreneurs at the meeting agreed that the focus on discounts and promotions is the best solution. They requested the Ministry of Culture, Sports and Tourism to carry out the demand stimulus program for 2013 while awaiting Government aid for further price cuts to create a big program.

Otherwise, they said, companies in the industry will be unable to burden more expenses to launch the demand stimulus program given the current difficulties.

The State needs to reduce tax soon so that industry players can slash prices accordingly, Phan Dinh Hue, director of Viet Circle Travel & Service Co. Ltd., said. He wondered why the State has yet to provide a bailout package to the tourism industry as it has done to the struggling property industry.

The tourism ministry has recently proposed the Government to halve VAT and either reduce or exempt 50% of corporate income tax in 2013 for travel and trading companies to help these entities join this year’s demand stimulus program.

Hoang Thi Diep, deputy head of VNAT, meanwhile, called for involved enterprises to present discount programs soon to have them introduced to local and foreign visitors.

VNAT has launched its website at http://timelesscharm.vn to promote the demand stimulus program 2013, with all corporate participants allowed to introduce themselves free of charge.

International tourist arrivals to Vietnam have reached an estimated 2.9 million in the first five months, tumbling 1.4% over the same period in 2012, reports the General Statistics Office. The country has for the first time recorded a fall in foreign tourist arrivals since 2009.

Source: SGT