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If we allow gaming, we must tax it to the hilt

June 5, 2013.

Dear Sir,

I think Tourism Minister Shawn Crockwell has several weak points in his statement about gaming as reported in your newspaper. Right at the beginning is the worn-out moan about declining tourist arrivals. All politicians should confer and agree on a new focus if we want hotels and cruise both to thrive in Bermuda. Let us agree on the optimum number of cruise ship tourists we can accommodate and still provide the amenities that the hotel tourists need to enjoy Bermuda. Let that number become our annual goal for cruise ship tourists. Only then can we cater to both hotels and cruise ships.

The Minister speaks about our competitors in the south. They were not our tourism competitors before and they are not our tourism competitors now. Bermuda is really another world, in a class that permits of partial comparisons with some places but not the Caribbean. Climate and other factors give them a different focus to their tourism. They are economic not tourism competitors. Tourism will never again provide the jobs for the early school leavers as it did before. It will make some contribution but not the major one to our economy. Bermuda male youth need to realize that education is, in today’s global economy, the major predictor of future earnings.

A corollary to all this is that there has to be a balanced policing of our youth. Rehabilitation is the best choice. When it does not work, prison should not be a comfortable place. We need two kinds of prisons in place. We need one for those who need to and are willing to reform, and one for those who remain unchanged. Our underachievers are not the most suitable staff for hotels anyway. They tend not to project a welcoming spirit. It cannot be faked! More hotels will be a disaster if people who have practiced rudeness to tourists and everybody else for the last 20 years are the only people available to work in them. Although nothing is impossible, it will be a daunting task to rehabilitate these people.

The Minister speaks about new hotel development in the south, but does not mention the costs of labour there. Greater profit can be made in those other places where both construction and service costs are lower. Modern business goes where the profit is. Businesses forced from Bermuda should not be expected to return because they have been made aware of many other places where operations are less expensive. The old style factories are not coming back to the USA; the old style hotels are not coming back to Bermuda. There may be room for the business hotel we have in Hamilton already, but another one is years down the road and will only happen if we generate very much more business. Fairmont Hamilton Princess and the existing Hamilton guest houses will be eager to provide all the extra accommodation needed. We do not need new hotels, but we do need to help the existing ones to thrive.

The headline refers to gaming and the article warns states that Caribbean gaming attracts more locals than visitors. If gaming is allowed in Bermuda, there must be a substantial tax in three areas: licensing (for the business, for the profession), large membership fees to government for locals, and taxes for winnings. We cannot allow the gaming to go unsupervised and without a substantial benefit to Bermudians. Furthermore the taxes should go to designated social objectives not lost in the candy jar of Government general revenues. We have to control the business. We cannot let this huge business control us on any pretext. We must learn from the experience of other jurisdictions that have had little financial or social benefit from gaming, but plenty of problems.

BERTRAM GUISHARD

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Published July 01, 2013 at 9:00 am (Updated June 30, 2013 at 6:27 pm)

If we allow gaming, we must tax it to the hilt

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