Sat, 17 Jun 2017 11:17:24 +0000
By SHEILA SAKUPWANYA
Finance minister has called for reduced bureacracy in the tourism sector to improve perfornance.
Finance minister Felix Mutati said this will help grow the sector’s contribution to the Gross Domestic Product (GDP) from the current two percent.
And Tourism and Arts minister Charles Banda said Government considered tourism not only as a means of poverty reduction through job creation but also as a source of foreign earnings and economic diversification for national development.
The two ministers said this at the official opening of the one-day tourism consultative meeting at Government Complex yesterday.
Mr Mutati noted that there was need to address the transaction costs associated with bureaucracy in the sector and some elements of taxation that would enable the industry to thrive.
“There is no dispute that the sector is a priority for the Government but the engine is still idling, the cylinders are not kicking,” he said.
Mr Mutati bemoaned the rate of tax compliance in the tourism and other sectors, adding that it was for that reason that Government declared the tax amnesty.
“In order to enhance the rate of compliance, Government has declared tax amnesty so as to try to stabilize the country’s macroeconomic environment as part of giving as it is fundamentally important.
“The rate of tax compliance in the tourism sector is below 40 percent. There must be something we are not doing right to each other. Government attempted to do an experiment with the tourism fund and the default rate was bad,” he said.
He, however, observed that Government needed revenue in order to provide the infrastructure the tourism sector required to boost the industry.
Meanwhile, Mr Banda said Government was committed to a private sector-driven tourism development agenda with focus on community participation and access to tourism benefits.
“Tourism is considered everywhere as a means for not only reducing poverty but also as a foreign exchange earner, economic diversification and job creation, among others,” Mr Banda said.
And Tourism Council of Zambia president Hamoonga Ntini appealed to Government to reduce bureaucracy and revise tourism taxes so that they could be in line with taxes for non-traditional exports.
“Our appeal to the Government is that they should revise the corporate taxes charged in the tourism industry so that they could be in line with sectors like agriculture; consider the removal of value added tax on packaged tours, and to reduce taxes on anything that increases the cost to the travelers, and increase incentives for tourists to visit, and investors to invest in the industry,’’ he said.
Mr Ntini also lamented the bureaucracy in licensing in the tourism sector.
“Currently for a company to operate it needs about 52 licenses, permits and levies which is a hindrance to the growth of the tourism sector,’’ Mr Mtini said.
