Because of the impact on cash flow caused by the recent tax reform, the tourism industry has lowered expectations on revenue forecast for the
next three years, from 8.6 to 8.3 billion pesos (approximately from $665 to $640 million USD). This was necessary, despite increases in tourism and foreign exchange earnings in first semester to record levels over the last three decades.
Pablo Azcárraga, chairman of National Tourist Business Council (CNET), said that tax reform has forced businesses to earmark 10 to 15 percent of their revenue stream to pay their tax obligations.
Pablo Azcárraga, chairman of National Tourist Business Council (CNET)
Businesses depend on actual and projected revenue streams for investing in new projects or maintenance. As a result, a number of businesses have made last minute planning changes, such as replacing some projects or reducing their size.
“Companies had to pause, and make last minute changes in their investments” said Azcárraga.
At a press conference, the employers said that they expected a bigger drop after the survey. However, some projects were replaced by companies
that are looking at the tourism industry as an alternative.
Azcárraga stated that there are new “Entertainment Tourism” projects, but did not specify details.
He also announced that an increase of one percentage point was made for the end of year projection, due to expectations in tourism numbers and revenues. In particular, 28.7 million tourists are expected for the remainder of the year (19% more than 2013), with over 16.3 billion dollars in foreign exchange earnings (17% more than 2013).
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