Hospitality industry resists 10% levy plans

2014-08-18 00:00

THE Tourism MEC’s plans to introduce a 10% hospitality levy has drawn huge resistance from the industry.

On Friday, KwaZulu-Natal MEC for Economic Development, Tourism and Environmental Affairs Mike Mabuyakhulu announced the levy would come into effect by April next year.

Spokesperson for the department, Bheko Madlala, said further discussion around the levy would be scheduled and that the levy would be a 10% charge of the room rates and food bills of foreign tourists.

Peter Rose, chairperson of the eThekwini Region and Umhlanga Coastline Community Tourism Associations and owner of the Anchor’s Rest Guest House in Umhlanga, said the levy would still have to be discussed with those in the industry and that any idea of it being passed was “wishful thinking”.

“Most of those in the industry are already paying a 14% for value added tax, adding a 10% levy charge would bring the amount up to 24%. There is also a one percent voluntary levy in place, meaning that 25% of our income on visitors would be going to other places.”

In earlier statements, Mabuyakhulu said that the aim of the levy was to build a “war chest to attract major events” to the province. However, local business said the charge would have a negative impact on tourism.


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