In her budget speech, the Ugandan Minister for Finance Maria Kiwanuka revoked the VAT exemption granted to hotels, lodges and resorts. She also imposed VAT, which stands at 18% in Uganda, on water and flour, making the cost of running a hotel and serving meals more expensive. And these expenses will be passed on to the guests.
Tourism stakeholders immediately objected to the measure, some pointing to the clear discrepancy of government terming tourism an export industry and then slapping two key ingredients, accommodation and meals, with VAT, while other exports do not have to bear such added costs.
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