Hotels in Lithuania face struggle for survival


As in Latvia, a preferential VAT rate of 5 percent applied to the hotel sector in Lithuania until the end of last year. The tax has now been raised to 19 percent, effective from the beginning of 2009. As a consequence, many hoteliers say they are paying taxes to the state out of their own pockets. But this is not the biggest problem. Hotel turnover started receding already at the end of last year. "Hotels are half-empty," complains Zilvinas Vasiliauskas, chairman of the board of the Klaipeda hotel network. Only 150 out of 600 apartments offered in Vilnius were occupied in November. The situation is reportedly even worse in Kaunas, where less than 20 percent of apartments are occupied.


Lietuvos Rytas, 2009-01-27

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