He Ministry of Tourism seeks to extend the benefit of zero VAT —which expires in November— for residents in Uruguay, with the aim of promoting the internal tourism in a context in which the exchange difference with Argentina It worries the local tourism sector and the authorities.
Tourism is a sector that generates some uncertainty in the government, with figures that, on the one hand, show a gradual recovery of the sector, led, above all, by Brazilian tourists; but, on the other, with a situation already classified as “exodus” of Uruguayans every time a weekend or tourist opportunity approaches on the local calendar.
Given this situation, the Ministry of Tourism has already announced a 9% discount on VAT in restaurants, vehicle rentals and seasonal rentals – through electronic payments – during the upcoming summer season, as a benefit or incentive for more visitors from abroad to arrive in the country between December and March. And although some sectors considered the measure insufficient, the general reception was positive.
However, the portfolio led by Tabare Viera has its sights set on the situation of exchange difference with Argentina which means that, week after week, the international bridges are full of cars crossing from Uruguay towards the neighboring country. Mostly, for the tourist impact which is projected for this same reason.
Zero VAT for domestic tourism?
To the Ministry of Tourism A key fact did not go unnoticed: during the recent spring holidays, 83% of the Uruguayans who traveled did so towards Argentina. During these days, national destinations are traditionally the most chosen; but this year, driven by the exchange gap in favor of the Uruguayan peso, the tourist balance she looked strongly unbalanced. The concern is that the same thing will happen in the summer.
Even more so if one takes into account that Argentinian airlines A new route will begin operating between Montevideo and Mar del Plata —one of the most important resorts in the neighboring country—, realizing that the Argentine government expects a large number of Uruguayan tourists during the 2023-2024 season, not only in inland destinations —as usual—, but also in the coast.
For this reason, the portfolio intends to extend the zero VAT benefit to Uruguayans—in force from November of last year to November of this year—, also at the request of operators in the sector, who understand that the measure would help lower costs and offer more competitive rates. The idea is that it can be announced “as soon as possible.”
“What was proposed to us and I agree due to the current situation, is that the government decree the Zero rate VAT not only exonerating tourists, but also allowing businessmen to discount their VAT of purchase,” said Minister Viera, in this regard.
“Today there are benefits that attract tourists or that reward those who choose to take vacations in Uruguay that have to do with the 100% exoneration of VAT in hospitality for both Uruguayans and non-residents. What we are going to try is to maintain the benefit for Uruguayans for the high season, starting in December,” he added.
Viera indicated that this initiative is proposed “for all sectors of tourism.” In that sense, he maintained that they have to see which are “the most affected” and which are the Ministry of Economy and Finance (MEF) consider that it can help.
Source: Ambito
