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aquaman
10-23-2013, 06:54 PM
Today I received notification that the Govt of Aruba has introduced a new environmental tax to apply on guests staying at vacation Villas, apartments and homes on the Island. The announcement does state that some areas are still under review as the tax is new. In summary, anyone staying up to 3 weeks ( short term stay) will be required to pay a tax of $3 per occupied room per night. The tax is retroactively effective back to August 1. Property owners must register their homes with SIAD and report the taxes by the 15th of each month using Govt provided tax forms. If this is not done the Govt has late filing and penalties that can amount to $1397 and for non-compliance late fees and penalties up to $5587. Guest registers and occupancy reports must be kept. One can only assume the full rental amount will be taxed before long as income to the owner, even if it has been declared in the owners country of residence.


If the owner has family, friends or non-paying guests, no tax is payable.

In summary, another cash grab. We offshore property managers get very little from this Govt. Maybe the taxes should be paid into trust with a Notary until the Govt and Police come up with an effective policing policy to offer better protection of our properties, as vacation homes are targets and get hit too often.

Thoughts on this???

John

Andrea J.
10-23-2013, 07:10 PM
Well the timeshare folks and hotel folks are feeling that pain too john. :(

aquaman
10-23-2013, 07:33 PM
Well the timeshare folks and hotel folks are feeling that pain too john. :(

Yes, I understand that. But what I am concerned about most is the fact that the income will be double taxed at the gross rate and not the net of expenses etc. I gather that from a particular reference in the announcement.

Andrea J.
10-23-2013, 08:20 PM
you need to contact the tax office re: the double taxing of the gross amnt and other questions that you may have.
i am very interested in hearing the reply that they give to you.

Yes, I understand that. But what I am concerned about most is the fact that the income will be double taxed at the gross rate and not the net of expenses etc. I gather that from a particular reference in the announcement.

danadog56
10-24-2013, 11:32 PM
so it is only the owner of the property.....not friends/family...
and what if you stay 3 months at a time ???

Arubalisa
10-24-2013, 11:35 PM
The Amsterdam Manor included the $3 per day levy in our price quote when we booked way back in February.

You do make a great argument for NOT investing in property in Aruba.

Andrea J.
10-25-2013, 12:01 AM
the tax is what the "renter" of the home/villa/condo has to pay per stay.....and i would imagine that the renter pays that to the owner.
$3 per night for up to 3 weeks.
the owner would be the one responsible to passing along the monies taken in to the tax office

here is an example danadog.........

let's say that i rent john's beautiful 3 bedroom house (with an awesome pool) for 3 weeks.
let's say he charges me $1000 per week = $3000
the additional tax is $63
it is my understanding that john has to forward that $63 to the tax office and i am pretty certain there is a substancial paperwork involved.

now if john "loaned" me the house and no money exchanged hands, would no tax would be due?



so it is only the owner of the property.....not friends/family...
and what if you stay 3 months at a time ???

aquaman
10-25-2013, 09:51 AM
the tax is what the "renter" of the home/villa/condo has to pay per stay.....and i would imagine that the renter pays that to the owner.
$3 per night for up to 3 weeks.
the owner would be the one responsible to passing along the monies taken in to the tax office

here is an example danadog.........

let's say that i rent john's beautiful 3 bedroom house (with an awesome pool) for 3 weeks.
let's say he charges me $1000 per week = $3000
the additional tax is $63
it is my understanding that john has to forward that $63 to the tax office and i am pretty certain there is a substancial paperwork involved.

now if john "loaned" me the house and no money exchanged hands, would no tax would be due?


Hi Andrea

You are correct, but to be specific, the charge is based upon room usage and not the number of guests. If you use all 3 bedrooms then the tax would be 3$x 3 bedrooms== $9/day

I do not like the fact that the Govt imlpemented this tax and apply it retroactively. How do owners now go back and ask renters?? Not possible. Also, I think it infringes upon privacy to have to maintain a register and provide it on a monthly basis showing who stayed at your home, how long, and what they paid. Also, at that point the Govt can then calculate an anual income tax against the owner ( similar to BBO ) I am of the opinion that it would have been a fairer and more manageable approach to possibly introduce a small increase in the property tax which, as you know, is very low.

What if the Govt challenges an owner over whether friends staying are in fact friends. This whole thing is fraught with problems. Also, in the announcement, any owner who has 4 appartments or combination of houses, villa, apartments is deemed to now be a "hotel" and will be taxed accordingly. I assume that owners of multiple timeshares are exempt as there is no specific mention of them.

John

aquaman
10-25-2013, 09:53 AM
Andrea,

If there is enough interest in this, I can post the official announcement

John

Andrea J.
10-25-2013, 10:32 AM
Go for it



Andrea,

If there is enough interest in this, I can post the official announcement

John

danadog56
10-25-2013, 06:39 PM
wow....I am right up there with ArubaLisa...very good argument for not buying a house in Aruba now.....I have been considering it for a few years now and was going to get rid of TS's and put the money towards an investment in a house....now I'm not so sure.

As for the TS's folks...as Andrea mentioned earlier...we got hit as well...but even that is getting a little riduculous, at Divi Village it goes like this...energy surcharge from 5.08-12.69/night depending on size of room, unit per night tax from 9.50-11.88/night and now a 10-25 dollar tax depending on size, but only per week, not per day...and that is only if you have consecutive weeks...I unfortunatley have 3 weeks 44, 46 and a float that I put in for 45...not considered a consecutive stay so will have to pay the fee 2x this year !!!
Oh well...nothing we can do about it...and as much as I love the island I will suck it up and pay....but probably not buy now....:(