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Zimbabwe extends waiver to tourism operators

by DANIEL JONES in Victoria Falls, Zimbabwe
VICTORIA FALLS – ZIMBABWE’S 2022 national budget is taking into consideration the challenges faced by the tourism sector as it reels from the impact of the coronavirus pandemic.

Government has extended a waiver on duty on motor vehicles imported by safari and tour operators.

It has extended the waiver on value added tax payable on accommodation and visitors’ services.

Finance Minister, Professor Mthuli Ncube, announced the measures recently as he announced the 2022 budget.

The 2022 budget is themed, “Reinforcing Sustainable Economic Recovery and Resilience.”

Economic growth is projected at 5,5 percent underpinned by high production in mining, agriculture and tourism.

The tourism and environment sector’s expenditure is estimated at ZWL$3,7 billion.

Ncube said the tourism sector was one of the key economic sectors negatively affected by the COVID-19 pandemic with the after effects still having an impact on all sub-sectors.

“Activities in the safari and the tour operations have thus remained subdued due to travel restrictions aimed at managing the spread of the pandemic,” he noted.

‘Consequently, operators have failed to fully utilise the current duty-free schemes. Hence I propose to extend suspension of duty on the motor vehicles imported by the safari and tour operators for a further two years beginning 1 January 2022,” Ncube said.

The tourism industry has been enjoying a duty free rebate on importation of operator’s vehicles such as buses, and others used for game drives, shuttles and transfers.

The industry imports most of its materials and equipment.

The demise of the tourism sector due to fall in arrivals left the industry with no revenue flows.

Waiver of the 14 percent VAT also payable in the tourism industry has been extended.

The tourism industry has been advocating for zero-rated VAT.

In support of efforts to boost local tourism following the slow-down in international tourist arrivals due to the pandemic, government waived VAT payable by domestic tourists for accommodation and visitor services within the framework of the COVID-19 Economic Recovery and Stimulus Package for a period of 12 months.

Zimbabwe’s economy is projected at 7,8 percent for the year 2021.

Alongside it is average industry capacity utilization, which is gradually picking up, reaching 47 percent and 54 percent in the first and second quarter of 2021, respectively.

By year end, it is projected to average 65 percent.

– CAJ News

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