Former Coffs Coast resident entrepreneur Dick Smith says mum and dad moteliers Australia-wide are being fleeced.
Former Coffs Coast resident entrepreneur Dick Smith says mum and dad moteliers Australia-wide are being fleeced. DEAN LEWINS

Dick's pitch to support regional tourism operators

DICK Smith is making a stand on behalf of mum and dad moteliers and Australia's tourism-reliant regions such as the Coffs Coast.

In what he calls modern-day "extortion", the well-known entrepreneur, and former Repton local, says millions of dollars in online accommodation bookings are flowing every day from Australian tourist hotspots like the Coffs Coast to a couple of US-based billionaires.

After a motelier raised the issue on radio, Dick has looked into the profiteering of accommodation booking websites such as Trivago, Booking.com and Wotif, which reportedly charge 15 per cent to 30 per cent online booking commissions to local hotels and motels.

With half of Australians now using these websites, Dick is calling for a boycott and his calls are being backed by tourism providers.

There's no escaping the television advertisements of online booking companies, stating they offer the cheapest rates for online accommodation bookings across Australia.

For the average motelier there's no option but to pay commissions to multinational companies like the Expedia Group and Booking.com given half of all Aussies use booking sites, Dick Smith says.

Unfairly for a mum and dad motelier in Coffs Harbour, Dick says these companies pay big bucks to Google, meaning their links appear at the top of landing pages.

The motel, apartment or hotel's own website meanwhile is buried at the bottom of the web page listings limiting their chance of direct online bookings.

"I'm bloody angry that millions of dollars are being extorted out of thousands of small family owned businesses and being shipped off to a few billionaires in the United States," Dick said.

"It gets me so angry, millions of dollars that should stay in our country towns are being shipped off and it's the same as extortion because it is not being done in a voluntarily way."

"They are like leeches because they offer nothing. They don't pay tax in Australia."

In a campaign, Dick is calling for Australians to boycott the big business booking websites and make direct accommodation bookings either online or over the phone.

"I said to the motels why would you bother to sign up?"

"And they said: 'Dick if we don't sign up to one of these sites, we'll lose 50 per cent of our business and we'll go broke'."

The Advocate approached several local operators this week, many had a lot to say off the record, but didn't want to go public.

One provider said it was set to pay $60,000 this year in commissions to overseas online booking companies.

 Local accountants Cynthia and Justin McErvale of Premier Accounting Services have been asked by tourism operators if the overseas booking companies are paying tax in Australia.
Local accountants Cynthia and Justin McErvale of Premier Accounting Services have been asked by tourism operators if the overseas booking companies are paying tax in Australia. Trevor Veale

Coffs Harbour Accountant Justin McErvale of Premier Accounting Services, who has several clients in the industry, said many queries are raised as to whether these overseas companies are paying tax and GST.

"The supply of something, whether a good or service, in Australia is the cornerstone of tax and GST, and there is no doubt in my mind the supply is being made in Australia by these overseas booking providers," Mr McErvale said.

"One well known company operates here in Australia, has a head office in Sydney and is registered as an Australian company, the company has an Australian Business Number (ABN) and is actually registered for GST.

"It's inexplicable that GST does not apply to all OTAs equally however.

"I further note the French taxation authorities are taking a company to task on this matter, as well as income tax, which is a whole other discussion.

"There have been some reforms with respect to the application of GST in Australia in recent times, the most notable relating to the application of GST to imported goods and some services.

"However the reforms clearly did not go far enough and we are still waiting on further reforms to give us a level playing field. We eagerly await the government's impending position paper on this issue."



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