Hospitality: Togolese government raises VAT back to pre-Covid level as sector recovers

Economic governance

Tuesday, 16 January 2024 16:15

Hospitality: Togolese government raises VAT back to pre-Covid level as sector recovers

(Togo First) - In Togo, the value-added tax in the hospitality sector is back to 18%. The tax had been reduced to 10% during the Covid crisis.

The government set the new tax rate in its 2024 finance bill. Lomé attributes the increase to a strong recovery of the hospitality sector between 2020 and 2022.

Over the period, Togo’s top 10 hotels recorded a turnover surge of 140% -from CFA7.1 billion in 2020 to CFA17 billion in 2022. The authorities attribute the burst to lifted health restrictions, which were introduced during the crisis. With the lifting, hotel activity returned to normalcy, and major events could be held in Lomé, the capital.

For example, the 2 Février, Togo’s top hotel, earned CFA8.7 billion in 2022, against CFA3.6 billion in 2020 (+69%).

The Sarakawa and Onomo hotels, among the country’s best, recorded similar growth.

Besides the growth, the government attributed its decision to raise the tax to its pre-Covid level to the need to re-balance public finances, which were drained amidst the pandemic. The move, they further claim, should ensure fair competition with other sectors, most of which are subjected to an 18% value-added tax.

Fiacre E. Kakpo

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