Booking.com closed a loophole that allowed hotels to save on VAT

In the Russian "gray" sector of mini-hotels, a mini-catastrophe - since the beginning of the year, the most popular hotel booking service Booking.com began to include VAT in the amount of 20% in the bill for services, RBC . learned This puts small hotels on the brink of survival, keeping prices low by avoiding paying it.

What's happened. Since January 2019, Russian VAT 20% from the booking fee has appeared in Booking.com invoices. Since the commission is from 10 to 25% of the amount of the reservation, including VAT, it rises to 12-30%.

Booking.com has been paying VAT on sales of electronic services to individual partners in Russia for two years now. It was assumed that legal entities and individual entrepreneurs owning hotels should pay VAT themselves, however, in practice, some of them made payments not from an official account, but from a personal one as an individual. At the same time, no one controlled the payment of VAT. According to RBC's interlocutor, there are "overwhelming majority" of such people.

• For legitimate business, nothing will change. VAT from the commission of a company that is not a tax resident of Russia is also required to pay mini-hotels operating under a simplified taxation system, reminds RBC.
• For the card-paying small Booking partners, this is very bad news. The situation in the hotel market is such that owners cannot raise prices, while in small hotels with 20–40 rooms, Booking.com provides up to 80% of occupancy, and booking costs reach 20% of turnover. “Along with rent and other operating expenses, this calls into question the existence of the business itself, which, in the case of a mini-hotel, creates up to 10-15 jobs, not to mention related businesses,” writes RBC with reference to the CEO of the MetaMoskva hotel. Sergei Dyakov.

Booking.com is the most popular online hotel booking system in Russia. More than 300,000 Russians use it every day, and 19,000 hotels are connected to it in million-plus cities alone.

Sergei Smirnov