Reduce accommodation VAT from 16 – 9% – Hotels Association

The Hotels and Catering Association of Zambia (HCAZ) has called for the reduction of the Value Added Tax (VAT) on accommodation and service from the current 16 percent to 9 percent, arguing that the status quo is a strain on the operations of the sector.

Speaking in an interview with the Zambian Business Times— ZBT over the expectations of the upcoming 2027 National Budget, HCAZ President De Rossi lamented at how the sector has always been double taxed, where the operators are made to feet for tourism, Council, and Zambia Tourism Agency levies.

“One of our longest cries is the reduction of VAT on accommodation and service from 16 to 9%, like other tourism countries, and scrap off double taxation where you pay 16% VAT plus 1.5% tourism levy, plus council levy, and ZTA fees. We need a single levy,” he added.

He also urged the introduction of the tax holidays and reduced income tax for national parks such as Lower Zambezi and Kafue National Parks. Rossi observed the full actualization of the duty-free incentive for hotel equipment such as safari vehicles and kitchen laundry, which is currently between 15 and 20%.

“This will make us too competitive with Kenya and Tanzania, and also we can fully actualize duty-free imports for hotel equipment, kitchen laundry, and safari vehicles, which is currently at 15-25%, but we know that with our lobbying there is already movement between the Ministry of Finance through ZRA, but members have to comply.”