The Caribbean’s hotel sector is pushing back hard against a new Booking.com policy that regional tourism leaders say could raise costs for hotels across the region.

In a sharply worded letter sent to Booking Holdings Senior Vice President of Accommodations Matthias Schmid, the Caribbean Hotel and Tourism Association (CHTA) objected to a reported policy change that would apply commissions to the total booking amount, including government-imposed taxes such as VAT and GST.

The change is expected to take effect in May 2026, according to the letter, and has already been confirmed by hotel operators in destinations including Barbados, Grenada, Jamaica and Trinidad and Tobago.

Why Caribbean Hotels Are Concerned

At the center of the dispute is a longstanding industry practice: hotels have traditionally paid commissions to online travel agencies only on room revenue, not on taxes collected on behalf of governments.

CHTA says taxes like VAT and GST are “statutory pass-through amounts” that hotels are required to remit in full and are not revenue for the property itself.

The organization argues that applying commissions to those tax amounts effectively increases Booking.com’s real commission rate without officially changing the headline percentage charged to hotels.

In the letter, CHTA said the move could create legal and compliance concerns in jurisdictions where taxes must be separately accounted for and fully remitted to governments.

Pressure on Caribbean Tourism Businesses

The regional hotel group warned that the policy could have a significant impact on Caribbean tourism businesses already facing high operating costs and heavy tax burdens.

According to CHTA, the new commission structure could compress hotel margins, place upward pressure on room rates and alter the balance between direct bookings and intermediary distribution channels.

The organization also said similar policy changes in the past prompted some Caribbean hotels to reconsider participation on booking platforms and adjust pricing strategies.

CHTA further argued that the impact would extend beyond hotels themselves, potentially affecting tourism workers, reinvestment in properties and overall destination competitiveness.

CHTA Wants the Policy Suspended

The association is calling on Booking.com to suspend implementation of the policy in the Caribbean and confirm that government-imposed taxes will remain non-commissionable.

The group also requested direct talks with senior Booking.com leadership.

“We urge you to reconsider this approach and to engage with us in identifying a solution that is fair, transparent, and sustainable for all parties,” wrote CHTA President Sanovnik Destang in the letter.

CHTA said that if the issue remains unresolved, it could engage regional governments, tax authorities and other stakeholders to assess broader implications and possible responses.