VAT on accommodation is protested by safari operators – Uganda Safaris & Tours
Safaris in Uganda are to be sold expensively due to the introduction of 18 percent VAT on hotel and lodge accommodation which will have devastating consequences on leisure tourism to Uganda’ said a regular tourism source in Kampala yesterday, when discussing the immediate impact of the restoration of VAT for hotel accommodation.
Tour and safari operators in Africa are bound by contract to maintain quoted rates for safaris for up to 18 months ahead, and are now stuck with the added cost, which if to be absorbed will render the safari businesses not just profitless but turn it into a loss maker.
Ministry of Finance sources on condition of not being named denied any impact of the VAT decision, showing their blatant ignorance about the inner workings of a sector, which has for years, despite of government neglect, grown, albeit at a pace fare slower than it could have, compared to for instance neighboring Rwanda, where tourism has been understood and embraced at the highest level of government and is being facilitated to create prosperity.
Gorilla safaris are at a risky hence Leading stakeholders have in recent days gone on rare record in the media over these actions, accusing government of not just mere lip service towards the sector but of creating a work environment radically opposed to the often talked about ‘enabling environment’, a phrase often used to self glorify economic advances even if glaringly absent.
What they have done is create a disabling environment for the tourism industry. The tourist board which is supposed to promote the country got a paltry 250 million Uganda Shillings. What the hell are they thinking that can do other than pay rent and utilities and maybe staff’ ranted another regular source, for obvious reasons wishing to remain anonymous.
Increased VAT on the accommodation will greatly affect gorilla safaris in Africa and specifically Uganda and also this will lead to job losses in the sector and will only make an already tough situation more difficult. Others of our neighbors treat tourism as a priority sector and here it is almost as if we are punished. Maybe they want to reduce tourism so that oil exploration can go ahead without us raising issues like in Murchison’s, where they want to pump oil in a wildlife park.
Uganda Safari operators in turn say they have no legal option but to accept the added cost, which hotels say they most reluctantly added to their bills but for fear of being raided by the Uganda Revenue Authority and made an example of should they fail to charge and remit the new tax burden.