Zimbabwe?s tourism sector pleads with government to scrap tax


The Zimbabwe Tourism Authority (ZTA) said Friday it is lobbying government to scrap a 15 percent tourism levy that it says is stifling growth in the sector. tax
ZTA chief executive Karikoga Kaseke told Xinhua in an interview that his organization was continually engaging government with a view to convincing it to drop the tax.
“We are trying to put our point across to the principals so that they understand how bad it is for the industry when they pursue and continue to charge the VAT, which is affecting the tourism industry to a very, very large extent,” Kaseke said.
The cash-strapped Zimbabwe government effected the value added tax (VAT) on hotel accommodation for foreign tourists in January this year in a move that has been widely condemned by the sector.
The sector argues that the levy makes Zimbabwe a more expensive tourism destination at a time when the country needs to boost tourist arrivals that had heavily plummeted in the past decade.
Previously, foreign tourists’ payments for accommodation and tourism-related services were exempted from the VAT, introduced in 2003, as part of efforts to promote growth in the sector.
Kaseke said the charging of the levy was not feasible and inappropriate, considering the huge potential of the sector towards economic growth and job creation.
Government, Kaseke said, must put in place measures that nurture the tourism industry and not kill the “the goose that lays the golden egg.”
He said the industry was totally opposed to the charging of the VAT although a compromise could be reached with government.
“Our position is that it (VAT) should not be charged on foreigners but we can still reach a compromise with government if need be,” Kaseke said.
The VAT also faced fierce resistance from Tourism Minister Walter Mzembi who in January argued that the levy is not an intelligent move considering that the country is already battling to improve its competitiveness through reducing tourism charges which are astronomically high when compared to those in the region.
Tourism is one of the key sectors that have huge potential to contribute to Zimbabwe economic growth but uncompetitive prices and visa restrictions, among other factors, are hampering fast growth in the sector.
Battered by a decade of sharp decline in tourist arrivals up to 2008, the sector is gradually recovering with the country last year recording a 2.6 percent growth in tourist arrivals to 1.88 million from 1.83 million in 2013, earning 827 million U.S. dollars in tourism receipts.
Kaseke also revealed that the pilot uni-visa jointly launched by Zimbabwe and Zambia in December last year is performing well and on course for extension into other southern African countries.
“The uni-visa is performing very well. Currently, people who are coming through Zambia are much more than those coming through Zimbabwe but at the end of day they end in Zimbabwe and those coming through Zimbabwe end up in Zambia,” Kaseke said.
He said Zimbabwe was happy about the performance of the uni- visa so far and was keen to have it extended to other Kavango- Zambezi Transfrontier Conservation Area (KAZA TFCA) countries namely Angola, Botswana and Namibia.
The KAZA TFCA covers five countries in SADC namely Zimbabwe, Zambia, Angola, Namibia and Botswana.
The ZTA recently said Zimbabwe and Zambia had processed over 3, 600 uni-visas by end of 2014.
The two neighboring countries launched the uni-visa to facilitate easy movement of international tourists between the two countries.
The pilot uni-visa will run for six months up to June 2015 after which it will either be extended to three other countries in the region or continue for another period while authorities assess its performance.
The launch of the uni-visa was a culmination of efforts by the two countries who temporarily implemented the uni-visa system when they jointly hosted the United Nations World Tourism Organization General Assembly in Victoria Falls in 2013.
Delegates to the UN event were issued with a uni-visa during the period of the conference to enable them to move freely between the two countries for meetings.
The 30-day uni-visa is currently benefiting nationals from 40 countries around the world that are in Zimbabwe’s category B visa regime, which requires such nationals to obtain visas upon arrival in Zimbabwe.
The countries in category B include Japan, Brazil, the United Arab Emirates and those mainly from Europe.
Zimbabwe and Zambia share the majestic Victoria Falls, a prime tourist attraction for the two countries which is revered as one of the seven natural wonders of the world. Enditem

Source: Xinhua

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