Hamptons on the Bay is very pleased to announce that they were independently nominated and were successful in winning the award for: Luxury Villa of the Year – Tasmania – AUSTRALIA for the 3 Bedroom House located in Rocky Hills – Swansea region on the East Coast of Tasmania.

In conferring the 3 Bedroom House at Hamptons on the Bay with its prestigious award, the LTG had this to say:

“The Luxury Travel Guide Awards represent the pinnacle of hospitality achievement, championing the best in their respective fields; therefore to come out on top is truly an achievement you should be proud of.

We are delighted to pay tribute to and commend all those who have excelled in the industry. This year has seen an unprecedented number of shortlisted companies, providing strong competition in every category.

All winners of the Luxury Travel Guide Awards are subject to the same rigorous assessment criteria, carried out by our in-house professionals. This ensures only the most deserving firms and individuals walk away with one of these prestigious accolades and gain a place in our awards winners’ guide, which will be distributed to over 500,000 professional & affluent people worldwide.  We have a massive sponsorship deal with Aspire so the guide will be found in airport lounges worldwide, as well as on cruise ships, a further 10,000 hotels, holiday specialists and tour providers.”

It is the case that many businesses legitimately structure their operations to minimise their taxation obligations and no issue is taken with those strategies.  However, even when online travel agents (“OTAs”) (foreign or local) are legitimately operating within the rules, there are some less obvious outcomes that often have a direct impact on the bottom line of mum and dad operators whose services or products are being offered and sold through OTAs. Especially so, if the OTAs are not registered for GST in Australia.

It is common for OTAs to charge commissions of anywhere between 6% and 20% of an accommodation provider’s gross nightly room rate.

Whilst accommodation providers rely heavily on OTAs to engage and attract customers, the combination of:

• foreign non-resident OTAs, with limited operations in Australia; and
• those entities not being registered for GST in Australia,

can have a significant impact on a small business’s cash flow and margins.

Why an OTA being registered for GST matters

Let’s start by looking at some of the basics:

–       generally, OTA commissions are calculated on the gross room rate per night.  Where a room is sold for $250.00 per night, the OTA earns anywhere between $15.00 (6%) and $50.00 (20%);

–       accommodation providers must remit to the Australian Taxation Office 1/11^th of the $250.00 per night room rate as GST.  This GST goes to the benefit all Australians;

–       an OTA that is outside of Australia and not registered for GST, means that the accommodation provider is unable to claim back an input tax credit on the commission paid;

–       if an OTA is registered for GST in Australia, an accommodation provider may, generally, claim back an input tax credit of 1/11^th of the commission.

On a per night basis, the input tax credit based on a:

–       12% commission of $30.00, equates to $2.73; or

–       15% commission of $37.50, equates to $3.41.

Whilst these amounts may seem insignificant, the table below shows how a small input tax credit may translate into the difference between a business breaking even or suffering a substantial loss.

If the example in column 4, OTA registered for GST in Australia (12% commission), is taken as the base case and represents a break-even scenario, the impact of being unable to recover just $2.73 on all room nights sold (with all other things being equal) translates to a $5,454.55 loss (see column 5).  The potential loss is amplified as the commission rate rises to 15% and the differential between an OTA that is registered or not registered for GST increases to $6,818.18 (columns 6-7).

The figures used in the example are to demonstrate the potential effects that recovery/non-recovery of the GST input tax credit may have on the bottom line and does not take into account whether the pricing structure or margins are appropriate.  Further, it should be noted that most accommodation providers source their bookings through a combination of direct sales and OTAs.

Book direct or use an Australian based OTA who is registered for GST

The buy “Australian made” campaign applies equally to services such as accommodation.  Travellers wishing to support the local economy can:

–       significantly benefit local businesses;

–       ensure that more of their holiday dollars are retained in Australia; and

–       obtain at least equivalent rates and possibly lower rates directly from the accommodation provider,

by adopting a couple of basic strategies:

–       book directly with accommodation providers; or

–       purchase accommodation through an Australian based OTA who is registered for GST in Australia.

An accommodation provider who is on the ball should gladly share a portion of the commission that might otherwise be payable to an OTA, with a valued customer who books directly.  Note that some OTAs seek to limit the way in which accommodation providers may offer rooms at lower rates than those offered by an OTA.  Customers should walk-in, email or telephone the accommodation provider directly for the best rate.

By making these small changes, Australian holiday makers can significantly benefit the overall economy and convey a message to foreign companies that whilst their trade and services are welcome and valued, the Australian spirit of giving everyone a fair go is still alive and well.

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“Parity clauses generally require accommodation providers to offer best price and availability to online travel sites. This guarantees the online travel site the accommodation provider’s lowest rate and prevents competitors and consumers from negotiating better deals directly with the provider.”

The ACCC noted that the benefit to travellers of the recent agreements is to remove the barriers to price competition between major online sites for hotel bookings. And “Australian accommodation providers will now be able to tailor their offers to better meet the needs of their customers and their own businesses requirements. They will now be able to offer lower rates through telephone bookings and walk-ins, offer special rates and deals to customer loyalty groups, in addition to offering deals via Expedia and Booking.com.”

But does the agreement struck by the ACCC go far enough to provide customers with the best deal or provide any tangible benefit to accommodation providers? An article on the website Travel Trends suggests that the industry doesn’t think so. In that article it was noted that:

“By far the biggest concern is that operators of accommodation businesses are prevented from advertising on their own websites a  lower room-rate than what these online travel agencies display.”

“The ACCC has seemingly overlooked the fact the internet is easily the number-one way consumers book accommodation.”

“Effectively, this means the online travel agencies can still dictate – from their offshore headquarters – to small motels in regional Australia what price they can charge for providing a service, when many of these accommodation businesses are struggling to be profitable.”

An article published on News.com.au notes that both France and Germany have recently outlawed the practice of online travel agents being able to dictate what hotels can and can’t do with their own room rates.

For the moment, the message for travellers in Australia is – email or telephone the accommodation provider directly to get the best rate.

http://www.traveltrends.biz/ttn555-hotelier-outrage-over-accc-rate-parity-agreement-with-booking-com-and-expedia

http://www.afr.com/news/accc-expedia-ruling-allows-hotels-to-reduce-rates-below-online-platforms-20160901-gr72x7

http://www.theshout.com.au/2016/09/05/article/ACCC-accommodation-agreement-slammed/PXBKHQQMXS.html

https://www.accc.gov.au/media-release/expedia-and-bookingcom-agree-to-reinvigorate-price-competition-by-amending-contracts-with-australian-hotels

http://www.smh.com.au/business/consumer-affairs/expedia-and-bookingscom-now-have-to-compete-on-hotel-rates-accc-20160902-gr749b.html

http://www.news.com.au/travel/travel-updates/travellers-urged-to-shop-around-following-changes-to-online-hotel-room-bookings/news-story/941dc9fb5cb335c466e4350d0d5d1064

http://www.abc.net.au/news/2016-09-02/accc-expedia-bookingdotcom/7808780

Being in the oldest rural municipality of Glamorgan, the township of Swansea, or Waterloo Point as it was known when first settled around 1821, is steeped in history. Several historically notable buildings including the 3 storey Morris’ Store (1834), the Swan Inn (1841), the Glamorgan Council Chambers (1860) and All Saints Church (1871) are all right in the centre of town.

Between 1835-45 convicts from the Rocky Hills Probation Station worked on the roads through the mountains to Avoca and south to Hobart. There are several notable structures including Spikey Bridge (previously known as La Farelle’s Bridge) and the Three-arches Bridge that can be seen near the Mayfield Conservation Area that were constructed by convicts and both are about a 5-minute drive from the Hamptons on the Bay property.

On the Hamptons property itself there is a culvert that was constructed by convicts using field stones similar to Spikey Bridge. Please visit the websites below for more information about Tasmania’s convict ancestry and history.

http://www.discovertasmania.com.au/home/local-tips/spikey-bridge

http://www.aussietowns.com.au/town/swansea-tas

http://ontheconvicttrail.blogspot.com.au/2013/05/the-spiky-bridge.html

http://www.glamorganhistory.org.au/

These are some of the things guests have written.

 Awards and Certificates

• Winner Tripadvisor Certificate of Excellence 2016
• Winner Tripadvisor Certificates of Excellence 2015
• Winner Booking.com Award in 2016
• Winner Booking.com Award in 2015
• Winner Booking.com Award in 2014
• Winner Trivago Award in 2017
• Winner Hotelscombined.com Award 2015