Taxes and fees "eat away" tourists' money
In mid-June this year, Mr. Luong Van's family chose a 5-day, 4-night trip to Thailand for 6.3 million VND/person. The tour operator was a domestic travel agency. After more than 1 hour of flying from Ho Chi Minh City to Bangkok, Mr. Luong Van's family boarded a car to Pattaya - a famous tourist destination in Southern Thailand, and the last leg was back to Bangkok. The tour took them to all famous tourist destinations, staying at a 4-star hotel, eating well, and having massage services for both men and women; especially a buffet party at an 84-storey building with many specialties. What surprised Mr. Luong Van was that along the tourist attractions, hotels, restaurants, etc., groups of tourists from Vietnam "overwhelmed" with a variety of Northern - Central - Southern accents.
Mr. Vo Tan Quan, the tour guide of the group, shared: “The cost is so cheap, you will not find it in Vietnam, even though the income of Vietnamese people is much lower than that of Thailand. The reason is because the units have joined together and unanimously reduced the price to attract tourists.”
From the story of traveling in a foreign country to look back at the reality of the price of domestic tourism services is still too high, in which the cost of airfare is a typical example. On November 9, Ms. Bong Mai, living in Binh Chanh district, Ho Chi Minh City, bought a one-way ticket of VietJet Air to travel to Thanh Hoa, the ticket price was listed at 680,000 VND, but including all kinds of taxes and fees, the price increased to nearly 1.4 million VND.
Also by VietJet Air, Sunday, November 12, the flight from Hanoi to Phu Quoc at 12:50, costs 2 million VND/ticket, but with other costs, it is nearly 2.9 million VND. Or by Vietnam Airlines, the flight from Hanoi to Phu Quoc on the weekend of November 17, departs at 10:05, costs 2.769 million VND/ticket, but with total costs, it is up to 3.618 million VND. Even though there are times when airlines offer 0 VND tickets, in the end, customers have to pay from 600,000-800,000 VND/ticket (depending on the flight route), due to taxes and fees.
Mr. Nguyen Minh Man, Director of Communications - Marketing of TST Tourist, analyzed that airfare accounts for 30% - 40% of the tour price structure. For example, a package tour costs about 10 million VND, the airfare accounts for 3-4 million VND. Therefore, if the airfare is "soft", the tour price will be lower, stimulating tourists to pack their bags and go out.
Tourism businesses reflect that the 2% reduction in VAT (to 8%) is really insignificant. Furthermore, what tourism businesses want is preferential policies for bank loans to maintain operations, because they have to borrow at high interest rates or borrow hot money from relatives to temporarily manage their work. However, after many meetings with banks, a leader of the state bank himself confirmed that it is very difficult to lend to tourism businesses because the industry is risky, so businesses have to "swim on their own".
Another cost that also accounts for an important proportion of the tour price is the hotel fee. Ms. T., director of a 3-star hotel chain in District 3 (HCMC), said that the room price currently bears additional taxes and fees, such as 8% VAT, 5% service fee (particularly for joint venture companies, the service fee is 6%-8%)... which increases the price.
“Recently, business operations have been difficult due to the Covid-19 pandemic, so our hotel has been exempted from electricity bills by 30%-40% and has been allowed to delay paying land tax of more than 10 billion VND. In reality, business is still very difficult, due to the low number of tourists, so we have to struggle to make ends meet. With room occupancy rates of less than 70% as they are now, revenue only temporarily compensates for inflation as well as operating costs and employee salaries. If the government exempts taxes and fees, we will also agree to further reduce room rates, tour prices will certainly be much cheaper than now, thereby stimulating the tourism industry,” Ms. T. analyzed.
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Tan Hoa has become the best tourist village in the world, considered a place that creates new tourist attraction in Quang Binh. Photo: HOA MINH |
Fragmented links, lack of comprehensive solutions
When writing this series of articles, we have received many thoughtful analyses from experts and businesses in the tourism sector. All opinions agree that the current weakest point of the tourism industry is the lack of systematic connections. For example, Ba Ria - Vung Tau province has always been one of the top choices for tourists, but recently, many businesses have complained about the lack of guests staying.
Statistics from the Ba Ria - Vung Tau Tourism Association show that during low season, room capacity is only 40% - 50%, and for many units without traditional customers, this number is much lower. An issue that many businesses, investors, especially travel agencies, are currently interested in is the issue of tourism linkage between provinces and cities in the region. Although discussed many times, very few inter-provincial tours in the region have been formed; linkage in tourism is still fragmented, each province has its own strength, and there is no extensive cooperation. Meanwhile, the Southeast region has full potential to attract tourists because it has mountains, seas, historical sites, and famous scenic spots.
Mr. NGUYEN VAN PHUC, Director of the Department of Tourism of Thua Thien Hue province: Issuing a regional development strategy to avoid duplication It is necessary to issue a common regional tourism development strategy so that each locality can build tourism products with its own characteristics on the basis of local cultural, historical and natural values that complement each other but do not overlap, in order to create a chain of attractive tourism products, prolonging the visit of tourists is very necessary. In addition, there needs to be a "three-way" coordination between accommodation establishments, travel services and the transportation system.
On the other hand, according to experts, even if there is a connection, it is loose. For example, thanks to the possession of heritages as well as geographical proximity, the three localities of Thua Thien Hue, Da Nang, and Quang Nam have proactively signed a cooperation agreement with the theme "Three localities - one destination". Then, in early 2022, the cooperation and linkage activities for tourism development were expanded to 5 localities (including Quang Tri and Quang Binh provinces). The localities take turns holding the role of group leader. However, in reality, it is inevitable that there will be certain difficulties due to the lack of coordination.
Secretary General of the Da Nang Tourism Association Ho Thanh Tu said that during the peak of domestic tourism, each locality’s units and businesses are very busy with their own plans and markets, so the connection work is still “loose and scattered”. Sharing resources for mutual development, however, to be clear, a “conductor” is needed to coordinate the whole region smoothly.
Tourism expert Nguyen Duc Chi acknowledged that the tourism industry is considered a “test barometer” of the economy, so the reactions of people and tourists to destinations need to be considered and adjusted accordingly. For example, in Thailand, immediately after the chaos at Siam Paragon shopping mall (Bangkok), fearing a drop in the number of visitors, the Thai tourism industry quickly adjusted the visa exemption policy to include India and Taiwan (China); extended opening hours to 4 a.m. for entertainment venues in Bangkok, Phuket, Chiangmai and Chon Bori.
“They carefully study the tastes and reactions of customers to the tourism market to quickly make timely adjustments. They work very quickly, and their products and services are constantly upgraded; especially the Thai tourism industry is very receptive. That is why, even though they have been to Thailand many times, customers are still fascinated, because the prices are consistent, the sellers are cheerful… Many tourists admit that they have spent every last penny, because Thailand's way of doing tourism is so clever,” Mr. Nguyen Duc Chi cited.
Agreeing with the above viewpoint, Mr. Nguyen Huu Y Yen, Chairman of the Board of Members of Saigontourist Travel Company, said: “The solution is that localities, tourism businesses, and destinations must join hands closely, maintain good prices, and wholeheartedly go all the way for the benefit of customers. In addition, post-audit work is very important to evaluate the effectiveness of the entire signing and cooperation process.”
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