ZATI receives funding to review tourism tax regime in Zanzibar

  •  Zanzibar ranks 155 out of 183 countries in the Doing Business in Zanzibar 2010 report.
  • ZATI receives funding for advocacy project aimed at improving the tourism tax regime and ease of doing business.

Today, the Zanzibar Association of Tourism Investors (ZATI) received funding from BEST-Dialogue to research the tourism tax regime and develop a raft of proposals for the Government aimed at improving the ease of doing business in Zanzibar.

ZATI Chairman, Omar Said Shaaban, said: “Simplifying the process of paying taxes will improve the ease of doing business, encourage compliance, stimulate economic growth and boost employment. ZATI understands that taxes are vital to ensure the provision of essential services that help communities and businesses develop, but high tax rates and a complex business environment represents a major barrier to the ease of doing business and discourages investment.”

The Doing Business in Zanzibar 2010report, by The World Bank and International Finance Corporation, positions Zanzibar at 155 out of 183 countries in terms of ease of doing business. Tanzania mainland is ranked 131, small island economies average at 91, while Sub-Sahara Africa averages at 139.

Doing Business in Zanzibar 2010 reports that: “In Zanzibar Town, a typical medium size company makes 48 payments, pays 40.8% of its commercial profit in taxes, and spends 158 hours per year on tax compliance – including 26 hours for corporate income taxes, 60 hours for labour taxes, and72 hours for the value added tax (VAT). The Maldives are the global leader…with the lowest tax administration burden. Maldivian companies make one single property-transfer tax payment per year, which amounts to just 9.1% of a company’s commercial profit.”

ZATI will be holding consultations with public and private sector tourism stakeholders to research and prepare a position paper to be shared with the Government. The paper will report findings and proposals aimed at encouraging improvements to the tax regime and the ease of doing business – which will in turn aim to improve compliance, stimulate economic growth and employment, andincreases the confidence of investors.

When ZATI met with the President in 2013, he said: “Tourism has outperformed all other sectors by a large margin. Over the ten year period 2000 to 2012 tourism achieved an average growth rate of 6.8% yearly. As a result, tourism has increased its share of GDP from a single digit in 2004 to just over 27% in 2012.”

ZATI believes that improvements to the tax regime and the ease of doing business, will stimulate further economic growth – leading to increased contributions to GDP and FDI, while boosting employment within the tourism sector and related industries.

Qatar Airways confirms new Zanzibar flights from July

Qatar Airways will launch flights to Zanzibar, the airline’s third gateway in Tanzania after Dar es Salaam and Kilimanjaro. From July 1st, the new five-times-a-week flight to Zanzibar will operate via Kilimanjaro.

The current Kilimanjaro flights which today are served by Qatar Airways via Dar es Salaam will be made non-stop from Doha to Kilimanjaro, with return flights from Kilimanjaro to Doha served via Zanzibar.

The new destination Zanzibar and the launch of direct flights to Kilimanjaro will add even more options for passengers when travelling to any of the more than 140 destinations served by Qatar Airways.

Similarly, passengers from the Middle East, Asia Pacific and Europe can now take advantage of connections to these Tanzanian cities via Doha’s hub, Hamad International Airport.

The mystic spice island of Zanzibar in the Indian Ocean will take the total number of destinations in the airline’s African network to 20 cities.

The new destination makes a perfect island holiday spot for leisure travellers with its white sandy beaches, abundant wild life, rich culture and long history.

“Today’s announcement of new services to Zanzibar reflects our commitment to connect diverse cities via our Doha hub and offer our passengers an extensive range of exciting global destinations.

“As our 20th gateway in Africa, Zanzibar will strengthen our presence as one of the biggest airlines flying to the African continent,” said Qatar Airways chief executive, Akbar Al Baker.

Qatar Airways’ African expansion in the past weeks has included the announcement of a new destination Durban and increase in flights to Johannesburg which will launch on December 17th 2015, and also an increase in frequency to Cape Town from October 1st this year.

Qatar Airways has been operating in Tanzania ever since the airline launched flights to Dar es Salaam in 2007.

The Tanzanian operation was expanded in 2012 when the airline launched flights to Kilimanjaro.