New tourism law now in force, 'suspension of duty on safari motor vehicles'

Finance Minister Tendai Biti announced the reinstatement of duty rebate on capital goods for the tourism sector and suspension of duty on motor vehicles used by safari operators in a move expected to induce growth in the tourism industry.

Biti made the announcement during the 2011 Mid-Term Fiscal Policy Review.

The decision to reinstate rebate on capital goods was taken after it emerged that operators in the tourism industry had not realised much benefit from the initial incentive for maintaining and upgrading facilities due to limited access to long-term financing. The initial rebate of duty on capital equipment to support the expansion and modernisation of hotels and restaurants was introduced in March 2009 and expired in February last year.

In a statement, the ministry advised tourism operators the sector could begin to use the statutory instrument to effect the measures.

"The ministry is pleased to advise tourism operators that legislation to effect these measures is now in place.

"Tourism operators are advised to collect application forms from the ministry," read part of the statement.

Safari operators require customised vehicles, while hotels need equipment from cutlery to bedding and both need support to bring the goods into the country after years in which their pockets were choked by economic sanctions.

The tourism sector performed better during the first half of this year with tourist arrivals and bed occupancy rates having both registered a 14,3 percent growth compared to the same period last year.

A total of 650 000 tourists visited the country during the first half of this year while average bed occupancy rate increased from 31 percent to 36 percent.