Lower 9 pc VAT for all-inclusive tourism packages

The VAT for all-inclusive tourism packages will be cut down to 9 percent, as it is a decision with low budgetary impact. PM Victor Ponta said “this was an issue of competitiveness for the tourism sector in Romania,” after concluding the talks with the IMF and EC experts. The budgetary impact is expected to reach RON 100 million for next year.

On the other hand, delegate minister for SME and Tourism Florin Jianu said all tourism packages which include accommodation will have a 9 percent VAT instead of 24 percent. Jianu underscored the decision will target all packages including accommodation and one or two meals a day.

Currently the 9 percent VAT is valid only for the tourism packages that include accommodation and breakfast. Hotel-keepers have requested during the latest years a reduced VAT for the other packages.

“We succeeded in agreeing that, besides accommodation and breakfast, the 9 percent VAT to be valid for the other meals as well as for other services, on the condition they are all included in the same tourism package for the same hotel. Any hotel-keeper offering accommodation at the least will benefit from the 9 percent VAT,” Florin Jianu said for Mediafax.

Secretary of state with the SME, Business Environment and Tourism, George Brezoi, said some 500,000 Romanians travel abroad for all-inclusive stays. “As with the lower VAT, we hope some 200,000 people of those who used to travel abroad would chose domestic hotels,” Brezoi further said.

Last year domestic tourism accommodation facilities served approx. 7.91 million people, of which 1.71 million foreigners. Most of them were coming from Germany (228,592), Italy (181,894) and France (118,649).