The Uganda government is to exempt accommodation, such as hotels and lodges, from the 18% VAT in an effort to promote tourism.
Hotels and lodges were originally exempt from VAT until July this year, when it was announced that accommodation venues would have to pay the 18% tax. The reinstatement of the exemption several months later has been welcomed by the industry.
Executive director of the Uganda Hotel Owner’s Association, Samuel Balagadde, says: “The exemption of VAT on accommodation for upcountry hotels and lodges was reinstated following the outcry from tour operators and hotel owners. I believe this is an incentive to support development of the facilities.”
Director of Africa Stay, Marian Sandu, says Uganda is not a cheap destination and with the extra VAT charges, would have continued to lose market share to neighbouring Rwanda. “I think this is very positive news for the inbound tourism in Uganda,” he says.
Tour operator, Travel Vision, has also welcomed the news. Sales and marketing manager, Sarah Whiteside, says: “We primarily book our gorilla wildlife encounters through Exodus, which is a UK-based adventure travel company. The rand has depreciated by approximately 20% over the last year making tours that are charged in GBP substantially more expensive for South African travellers. Any reduction in rates from any source is therefore greatly appreciated by South African passengers.”
