ECONOMIC IMPACT OF TOUR
OBJECTIVES
1. Explain that tourism activities bring in revenue to the country.
2. plain how the revenue from tourism benefits the country.
4. Examine both the positive and the negative economic impact of tourism on Belize.
4. Identify various ways in which jobs may be created as a result of Tourism activity.
POSITIVE ECONOMIC IMPACT
1. Foreign Exchange
- This is income earned from export of goods and
services
- It is used to pay for other goods and services not
produced or available in Belize as Belize is Not
self Sufficient in many things.
- eg: fuels, oil, machinery etc.
- Tourism earns 25% of Total Foreign Exchange.
2. GOVERNMENT REVENUE
Government earn revenue through
1. Room Tax = 7%
2. Departure Tax = 15%. US$3.75 goes to PACT
3. Casino Tax= through government Gaming Control Bill
4. Sales Tax = 8% from sale of goods and services
5. Import Duties and Levies= tax levies for import of
goods and services for tourism purpose. Eg: beverages,
hotel and restaurant supplies etc
6. Income Tax = tax levied of employees who work in the tourism idustry
7. Property Tax = land tax used to conduct tourism business
TOURISM CONTRIBUTE TO EMPLOYMENT
1. Direct Tourism Employment
Eg: waiters, bartenders, tour guides, airlines, hotel &
cruise ship workers etc
2. Indirect employment: not directly employed in
the Tourism sector
-eg: banking, construction, agriculture/food sales, ….
CATALYST FOR DEVELOPMENT OF OTHER
INDUSTRIES & EVENTS
• As the tourism industry grows, the demand for locally produced goods and services
grows. Eg: La Ruta Maya, ……
TOURISM INFLUENCES INFRASTRUCTURE
DEVELOPMENT
• Tourism requires proper infrastructure such as roads, airports, seaports, water supply,
and communication system so as to accommodate the inflow of people that tourism
brings.
Eg: better high ways, paving of Placencia & Hopkins road, improve telephone service,
improve health services, better rural roads, more school building, etc.
NEGATIVE ECONOMIC IMPACT
1. Economic Leakage: This occurs when some of the profits that are generated by
tourism leave the host country.
Two Types: Import and Export Leakage
Import leakage occurs when tourists demand goods and services that are not available in
the country or cannot be supplied adequately. Much of the income from tourism is then
used to pay for these products. Eg:?
2. Export leakage: occurs when foreigners own or control the tourism infrastructure
and facilities. As a result of such ownership, export leakage arises when overseas investors,
who finance the resorts and hotels, take their profits back.
“All inclusive” packages or resorts - Local businesses complain that their chances of earning
income are severely reduced by the creation of all-inclusive packages. When tourists
remain for their entire stay on the same cruise ship or at the resort, which provide
everything they need and where they spend their money, little opportunity is given to
locals.
EG? ….
INFRASTRUCTURE COST
• Tourism development can cost the government and the taxpayers a great deal of money.
Investors may ask the government to improve roads, airports, and other infrastructure
and also provide tax breaks and other financial advantages. Government investment in
other sectors could be affected by heavy investment in tourism.
INCREASE IN PRICES
• Increasing demand for basic services and goods from tourists will often cause price
increases that negatively affect the locals, since their income does not increase with the
corresponding price increase.
• Eg? ….
