Jamaica’s hoteliers are concerned.
The Air BnB industry is growing with more than 10,000 active listings.
However, some are using the cloak of an Air BnB listing to boycott tourism taxes under the guise of being “a small man trying fi mek a likkle money”.
There’s nothing wrong with trying to make some money with an Air B n B side hustle. But, what about the tax paying small boutique hotelier?
It takes guts to start a business in Jamaica. However, the unregulated Air BnB industry creates the impression that it’s easy to tap into Jamaica’s billion dollar tourism industry while avoiding the tax man.
Air BnB hosts in most other countries are required to comply with the relevant tax laws. Jamaica has a 10% to 15% room tax, as well as other tourism related taxes, for hoteliers. Boutique hotels must pay these taxes and they also fall into the micro and small business category. So, why should Air BnB hosts be exempted from this requirement?
The costs of running an Air BnB are relatively high, especially when you have a mortgage to consider. The debate for Air B n B taxes, while necessary, should consider this fact. Taxes are justifiable if Air B n B hosts are being taxed within a certain threshold.
This is one of the many things you should consider if you want to start a business in Jamaica as an Air BnB host. Taxes and other regulations may not presently be a enforced but they may become a requirement in the near future. Here are some other things to consider if you want to become an Air BnB host in Jamaica.
How to Start an Air BnB Business in Jamaica
1. Register with the Tourism Product Development Company (TPDCO).
Collin Greenland, a forensic accountant, recently cautioned that Air BnB hosts should register their properties with TPDCO to protect themselves. Anything can happen to a guest while on your property and the monitoring TPDCO provides can help better protect the Air BnB owner.
2. Register as a sole proprietor with the Companies Office of Jamaica.
This isn’t mandatory but it can prove beneficial if you want business financing. First Global Bank presently offers home improvement loans to Air BnB owners with more than $130 million in loans having already been disbursed. Other financial institutions or investors, however, may require a more formalized approach to an Air BnB listing in order to secure financing. Learn more about registering as a sole proprietor by ordering a copy of The Business Playbook here.
3. Set up a state-of-the art property.
Visitors aren’t expecting your Air BnB listing to offer an all-inclusive hotel experience. However, they want to visit a place that provides that lavish experience without the lavish price tag. Invest in nice fixtures, decorations and amenities for your listing. Also, invest in the Human Resources and other elements you will need to make visitors feel right at home and make them want to return. You need those five star reviews!
4. Market your listing!
It isn’t enough to post some nice pictures of your listing and hope for the best. You’re competing with more than 10,000 other listings so you have to be creative if you want to consistently attract visitors. Use digital marketing strategies to your advantage as well as some or all of the strategies found here.
5. Respond to feedback and improve.
Read the reviews and engage with your guests. They provide valuable insight into things you may have overlooked. Always strive to improve and make your listing the best it can be!
The increasing concern about Jamaica’s unregulated Air BnB industry is something anyone hoping to start an Air BnB Business in Jamaica should watch closely. There may be changes to the way Jamaica’s Air BnB hosts are able to do business in the near future. Nevertheless, starting an Air BnB business in Jamaica can provide a lucrative source of income if you invest in your property, adequately market your listing and continuously improve the experience for your guests.
Need help starting a business in Jamaica? Order a copy of The Business Playbook today! Click here.
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