Rwanda Introduces 3% Tourism Levy to Boost Sector Growth
The Rwandan government has introduced a 3% tourism levy on accommodation facilities, including hotel room rates, as part of its tax policy reforms approved by the Cabinet on February 10, 2025. Officials state that this levy is aimed at supporting investments in the tourism and hospitality sectors, ensuring the continued growth and sustainability of the industry.
How the Levy Works
The levy is set at 3% of the hotel room cost, meaning that for a room priced at $100, an additional $3 will be collected as the tourism levy. Yusuf Murangwa, Minister of Finance and Economic Planning, emphasized that the levy is paid by the tourist booking the room and not by the hotel, clarifying that this is not a form of double taxation.
Tourism levies, commonly applied by governments worldwide, are reinvested into the tourism sector to fund infrastructure improvements, maintenance, conservation efforts, and the promotion of local attractions. This approach enhances the overall tourism experience while benefiting both visitors and local communities.
Rwanda’s Tourism Growth and Ambitions
Rwanda’s tourism sector has seen remarkable growth, with 21,232 hotel rooms currently available, up from 17,078 in 2020, according to the 2024 Statistical Year Book by the National Institute of Statistics of Rwanda (NISR). The Rwanda Chamber of Tourism aims to increase this number to 35,000 rooms over the next five years to meet the rising demand.
The levy comes as Rwanda works to increase its tourism revenue from $620 million in 2023/24 to $908 million in 2026/27 and ultimately to $1.1 billion by 2028/29, as outlined in the country’s 2nd National Strategy for Transformation (NST2). The MICE (Meetings, Incentives, Conferences, and Events) sector is also a significant contributor, with revenues expected to grow from $95 million in 2023 to $156 million in 2026/27 and $224 million by 2028/29.
Jean Guy Afrika, CEO of the Rwanda Development Board (RDB), highlighted that the levy would play a crucial role in funding sustainable tourism initiatives and supporting Rwanda’s ambition to become a high-end tourism market. He noted that Rwanda examined the practices of other countries in the region and across the continent before implementing the levy to ensure its alignment with international standards.
Investments in Tourism and Conservation
Under NST2, Rwanda is committed to diversifying its tourism offerings with a focus on nature-based tourism, conservation financing, and product innovation. This includes initiatives such as green bonds, public-private partnerships, and the development of new tourist destinations across the country. The aim is to position Rwanda as a top global destination for sustainable and high-end tourism.
The MICE industry will also be a key focus, with efforts to attract high-level meetings, strategic partnerships, and sports events aligned with national priorities. Professionalization programs and the introduction of industry standards and certifications will ensure a higher quality of services, enhancing Rwanda’s reputation as a global MICE hub.
In 2024 alone, Rwanda hosted 77 MICE events, welcoming 10,000 delegates in the fourth quarter, according to the Rwanda Convention Bureau (RCB). As Rwanda continues to host major international events, such as conferences and exhibitions, the tourism levy will provide critical funding to support the country’s growing prominence in the global tourism market.
Opportunities for African Travel Agents
For African travel agents, Rwanda’s 3% tourism levy offers an opportunity to showcase the country’s commitment to sustainable tourism and high-quality experiences. With a growing focus on nature-based attractions, luxury tourism, and world-class event facilities, agents can position Rwanda as a leading destination for eco-conscious travelers, business delegations, and event organizers.
By reinvesting the funds generated from the levy into infrastructure improvements and conservation efforts, Rwanda is setting a benchmark for how tourism revenues can drive economic growth while maintaining a focus on environmental and cultural preservation. This initiative not only strengthens Rwanda’s tourism sector but also reinforces its position as a model for sustainable development in Africa.
