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ZIM INDUSTRY UNPREPARED FOR VAT

The sudden introduction of 15% tourism VAT in Zimbabwe has taken the country’s tourism industry by surprise.
 
The announcement was made in the Government Gazette on January 16. It takes immediate effect and applies to all accommodation services. Other tourism services such as restaurants, bars and tourist activities will remain zero-rated.
 
Tour operators understood the VAT had been shelved after Zimbabwe’s Finance Minister,Patrick Chinamasa, didn’t mention the tax in his 2015 budget announcement. 
 
Brent Williamson, owner of Adventure Zone and Lodge, says the tourism industry was not adequately informed as to how and when the VAT would be implemented. “We have only now been advised by a Gazette dated 16 January that the VAT is effective immediately, leaving us already liable for losses for the past four days not to mention the people who have already been quoted for their stay in the future.”
 
Beks Ndlovu, CEO African Bush Camps, agrees. He says that while the industry was forewarned in May 2014 of the possible implementation of VAT, no clarity was given on when it would be implemented and legislated, which led to frustration and confusion. 
 
“By January 1 no clarity had been given on what would happen to confirmed bookings already in place, which services would be affected, and no legal instrument had been announced or gazetted,” says Ndlovu.
 
He says the lack of communication had resulted in operators assuming that the requests to hold off on implementing VAT at this stage had been taken on board. “The Industry therefore revised rates accordingly, excluding the VAT, only to be informed [on Monday] that the VAT has now been published and implemented via the official Gazette. This has certainly caused anxiety and unnecessary confusion in the market place as whole.”
 
Williamson agrees and says the VAT has made it extremely hard for the industry to keep suppliers up to date. “I have already received some emails from some of our agents who are very upset that they have to now go to their clients and advise that there is a 15% increase on their accommodation prices. This not only has increased our workload, but may possibly outpace us as a destination.”
 
Source: tourismupdate.co.za






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