African Bush Camps on VAT in Zimbabwe
During 2014 the Zimbabwe Government implied to the tourism industry that VAT of 15% was to come into effect from 1st January 2015 and on this basis we increased our 2015 rates in our Zimbabwe African Bush Camps to reflect this 15% VAT. Whilst we felt the need to raise our rates to cover the ever-increasing operating costs we resisted doing this as we felt that it was unrealistic to expect the market to handle more than a 15% increase despite the fact that this did not actually represent an increase to African Bush Camps.
The Zimbabwe 2015 Budget has now been published and the issue of VAT on accommodation to non-residents has not been addressed or legislated. We hope that this is an indication by the Government of the importance of tourism to Zimbabwe and not simply an oversight. In the absence of a definitive statement we have had to assume that for the time being there will be no VAT chargeable on tourism services supplied to non-residents. In light of this we have decided to reduce our current rates to reflect the non-imposition of VAT until such time that the Government passes the necessary legislation to amend the current regulations.
African Bush Camps will therefore revert back to our 2014 rates for our Zimbabwe properties and will maintain these rates for the remaining low and shoulder season up to the 30th June 2015. Due to various camp upgrades, in some cases totally rebuilt camps, new game drive vehicles, ever increasing operating costs and other improvements we intend to carry out during the first half of 2015, we feel that a minimal increase of 7.5% in our Zimbabwe rates from 1st July 2015 would not be unreasonable. Hence we will increase our rates on our Zimbabwe properties for anyone travelling 1st July 2015 through to 31st December 2015, this increase will affect all existing and future bookings.
As you will be aware, changing the systems to reflect these new rates is a bit of an administrative nightmare, but please accept our assurance that we will do our utmost to reduce the inconvenience to yourselves. There are a few different scenarios that might affect you:-
1) The booking has not yet been paid in full. In this instance we will supply a re-quote based on the adjusted rates. We are obviously willing to refund any excess deposit that transpires from the re-quote but in order to avoid potentially high bank charges we ask that you allow us to leave the excess deposit to go towards the final payment.
2) The booking has been paid in full. In this instance we will supply an adjusted final invoice reflecting the correct rates. Again we are obviously willing to refund any excess payment that results from the adjustment in rates. We ask however that you consider the two options below that will minimize the potential bank charges that could arise from a refund.
i) You allow us to remain with a credit balance on your account.
ii) You allow us to donate the balance to our African Bush Camps Foundation (www.africanbushcampsfoundation.org) where these much needed funds will go towards our conservation and community development initiatives. More information about these can be found on the website.
Whilst we hope that the Government of Zimbabwe will take note of the arguments put forward to further delay, or in fact scrap, the proposed implementation of VAT on tourism services supplied to non-residents, we are currently unsure of their intentions. Should the decision be made to introduce the VAT, we have requested that we be given sufficient time to warn the trade of the change, but we need to advise that until a definitive ruling is made VAT may be introduced at any stage. Should this happen we will obviously be forced to comply and given the change will be outside our control we will need to levy the 15% VAT on any bookings affected. We realize that this does not assist you to promote Zimbabwe as a destination and we apologize for any uncertainty it causes.
Whilst we continue to seek clarity on this matter, we would like to thank you all for your understanding and patience. Please be assured our concern is primarily to assist you to promote Zimbabwe and in particular African Bush Camps. Your support in all aspects goes a very long way in allowing us to strive to provide an unparalleled service to all our clients and at the same time use your support to assist in conserving our wilderness heritage and the communities that live alongside some of the most beautiful, but remote parts of Africa.
Your understanding in this matter is gratefully appreciated and we wish you all the best for 2015 and beyond.
The African Bush Camps Team.