Title
Aruba's Taxing Dilemma: Navigating Tourist Perceptions on Room Tax and Turnover Tax in Paradise
Abstract
This study presents the second part of our assignment for the Aruba Tourism Authority (ATA). Our study investigated the effects of two tax proposals (a turnover tax rate increase from 6% to 7% and a room tax rate increase from 9.5% to 12.5%) on tourism demand. We used monthly time-series data on tourism arrivals from several markets, including the U.S., The Netherlands, and other markets. We also segmented the arrival data based on the accommodations used in Aruba (high-rise, low-rise, and other accommodations). We applied several procedures to prepare and test the data before applying an Autoregressive Distributed Lag model to estimate the short- and long-term effects. The short-term effects relate to temporary instability generated along the long-term (structural) impacts. In the case of Aruba’s tourism, the short-term would indicate temporary up or down changes in tourists arrivals, which will gradually settle down to more consistent growth in the number of visitors. The results of our findings are presented below in the form of several questions.
Keywords
Aruba; tax; tourism
Prepared For
Aruba Tourism Authority
College
Rosen College of Hospitality Management
Publication Date
11-17-2022
Document Type
Report
Format
application/pdf
Language
English
Place
Aruba
Rights
No part of this publication may be reproduced, transmitted, transcribed, stored in a retrieval system, or translated into any language, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without prior written permission from The Dick Pope Sr. Institute for Tourism Studies. All copyright, confidential information, design rights and all other intellectual property rights of whatsoever nature contained herein are and shall remain the sole and exclusive property of The Dick Pope Sr. Institute for Tourism Studies. The information furnished herein is believed to be accurate and reliable. However, no responsibility is assumed by The Dick Pope Sr. Institute for Tourism Studies for its use, or for any infringements of other rights of third parties resulting from its use. The UCF and The Dick Pope Sr. Institute for Tourism Studies name and logo are trademarks or registered trademarks of the University of Central Florida.
Recommended Citation
Ridderstaat, Jorge; Croes, Robertico; Rivera, Manuel A.; and Park, Jeong-Yeol, "Aruba's Taxing Dilemma: Navigating Tourist Perceptions on Room Tax and Turnover Tax in Paradise" (2022). Dick Pope Sr. Institute Publications. 83.
https://stars.library.ucf.edu/dickpope-pubs/83