The Ministry of Tourism supported the request of the operators of the tourism sector and they request zero rate VAT in hotels in the country for Uruguayans during the season. Meanwhile, from the Ministry of Economy they pointed out to The country that the proposal is not currently being studied.
After two atypical and negative seasons due to the effects of the pandemic, the tourism sector is preparing for a new season and they hope it will be positive. However, the exchange gap with Argentina It causes fear among operators due to the possibility that Uruguayans choose to spend the summer in the neighboring country, especially those of lower socioeconomic status.
As stated by the Minister of Tourism, Tabaré Viera, this season will continue with the “line of growth that is verified quarter by quarter after the opening of the border in November 2021”, but warned that he does not want to “guess”.
The measure of not charging Uruguayans VAT on hotels is being requested with the aim of benefiting domestic tourism and offering locals a price that, in its entirety, makes staying in the country a good option. This benefit had already been offered during the pandemic.
From Tourism, a “package of arguments” will be sent to the Economy, because the differences between the five- and four-star hotels in relation to the rest represent a great difficulty for the less favored to overcome the exit from the crisis caused by the covid-19. 19. According to what the president of the Uruguayan Chamber of Tourism, Marina Cantera, told the press, “those (hotels) that depend on the Argentine middle class” are the ones that present the most difficulties.
Uruguay currently offers exoneration in the payment of VAT on hotels for foreigners throughout the year. To this benefit for non-residents is added zero VAT in restaurants, in catering for events, in services for parties and in vehicle rentals until April 2023 inclusive. In addition, non-residents receive a refund of 10.5% of the price when renting real estate for tourism purposes. Another concern they expressed is the competition represented by internet platforms that offer non-regularized accommodation,” Viera said.
However, from the Ministry of Economy they expressed to The country that the benefit approved during the pandemic “was something exceptional that occurred with closed borders” and that at the moment they are not contemplating the possibility of resuming it.
In this context, from the sector they indicated that they are betting on the Brazilian tourist to alleviate the lack of Argentines -especially from the middle class- and from the ministry they added that they intend to improve air connectivity between Brazil and Uruguay, as well as with other countries of the region such as Chile.