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The government of Tanzania grants a value-added tax (VAT) exemption on the sale and lease of air charters which gives a huge relief to tourism and aviation industry players in the country.
The government of Tanzania grants a value-added tax (VAT) exemption on the sale and lease of air charters which gives a huge relief to tourism and aviation industry players in the country. This means that the government wants to reverse its measure taken in the financial year 2022/23 on the supply of air charter services, as it seeks to complement the efforts of reviving the tourism industry along with the invaluable move of President Dr Samia Suluhu Hassan of promoting Tanzania as a tourism and investment destination, through the Royal Tour film.
The VAT exemption measure intends to support the growth of the aviation industry and reduce business and investment costs. The Tanzania Air Operators Association (TAOA) board Chairman, Captain Maynard Mkumbwa welcomed the government move, saying it offers enormous opportunities for the key economic industry to grow by leaps and bounds.
TAOA Chief Executive Officer, Lathifa Sykes said that the VAT on air charter services contained a seed of destruction as it had created turbulence and slowed down investments in the aviation industry. The aviation sub-sector is a key pillar of tourism in Tanzania as it contributes a fair share of foreign currency to the country. When aircraft are affordable, for example through VAT exemption, investing in the aviation sub-sector becomes lucrative. Through increased investment in the aviation industry, she explained, the basic law of supply and demand suggests airfare becomes affordable. This will result in an increase in local and international air travel. The investors will be happy with the profits, enabling the government to generate more income from tax.
Read Also:
https://trendsnafrica.com/air-tanzania-spreading-its-wings/
https://trendsnafrica.com/tanzania-resilient-natural-resource-management-for-tourism-and-growth-2/
TAOA is a member-base association that aims at fostering legal and responsible development of the aviation industry by ensuring safety, efficiency, regularity, and economic operations. It provides a common platform for the promotion of best practices and engages in effective advocacy with the government through responsible authorities.
