Summarized by AI Model:Overglitch/t5-small-cnn-dailymail
The Mozambican government announced last year that it will impose a tax on the digital economy starting in 2024 . This tax's scope has now been reduced to target international digital businesses that work in the travel industry . A bill to formally tax online transactions in the tourism industry was recently draughted .The Mozambican government declared last year that it will impose a tax on the digital economy starting in 2024. This tax’s scope has now been reduced to target international digital businesses that work in the travel industry. A bill to formally tax online transactions in the tourism industry was recently draughted by the Mozambican Tax Authority (AT). With the goal of regulating the internet economy and increasing the nation’s tax income, this program targets websites like Booking, Tripadvisor, and Hotels.com.
These platforms currently do not contribute to the national tax system; instead, they receive commissions on reservations made for Mozambican tourist facilities. By taxing the revenue these businesses make in Mozambique, the new law, which is scheduled to be introduced during the upcoming legislative session, aims to close this disparity. Despite the fact that these platforms are not physically present in Mozambique, Amorim Ambasse, director of the Mozambican Tax Authority’s Digital Economy Taxation Unit, clarified that they earn substantial profits that ought to be “taxable because they stem from economic activities conducted within Mozambique’s borders.”
This action takes place as Mozambique’s tourism industry is expanding rapidly. According to Eldevina Materula, Minister of Culture and Tourism, tourism revenues in 2023 amounted to $221.2 million, a 10.4% rise over 2022. Additionally, foreign visitors increased significantly, exceeding 1.1 million in 2023, a 31% increase over the previous year. The plan fits into a larger national plan to tax and control the internet economy. By focussing on international digital platforms, the government hopes to improve tax collection while simultaneously creating fair competition and a level playing field for regional companies.
The impact of digital technology on Mozambique’s economic growth could be amplified if this strategy is implemented. According to estimations from the International Finance Corporation and Google, the country would be able to contribute to the $712 billion that Africa’s digital economy is expected to create by 2050.
