Introduced: 1991
Standard Rate: 15%
Authority: South African Revenue Service (SARS)

South Africa’s VAT system applies broadly across accommodation, tourism, and event services. For foreign travel companies, the key issue is that most local services are treated as fully taxable and non-recoverable, which makes VAT a real cost when organising programmes in the country.

Scope for Travel Businesses

• Accommodation (hotels, safari lodges, guesthouses) is taxed at 15 percent.

• Tours, game drives, transfers, excursions, and local transport are also taxed at 15 percent.

• Event services such as venue hire, catering, AV, and staging are taxed at 15 percent.

• Safari and adventure experiences are taxable unless specifically exempt, which is rare.

For inbound tour operators and DMCs, VAT applies to the full package unless it can be clearly split between taxable and exempt supplies.

Refund Position

South Africa’s VAT refund scheme applies only to goods exported through designated ports, not to services consumed locally. This means:

• Hotel stays, tours, local transport, event costs, and DMC packages are not refundable.

• Corporate incentive trips, conferences, and group programmes incur irrecoverable VAT, which should be priced as a final cost.

• VAT recovery is only possible on physical goods that are exported, a mechanism with little relevance for most travel businesses - See International VAT Reclaim

Foreign companies cannot reclaim VAT on local tourism services unless the supply can be structured as an exported service, which is uncommon and tightly restricted.

Antravia helps

We support travel agents, tour operators, and event organisers by modelling the VAT impact on South Africa programmes, reviewing DMC and hotel invoices, and ensuring final pricing reflects the non-recoverable nature of South African VAT on services.

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Disclaimer:
Content published by Antravia is provided for informational purposes only and reflects research, industry analysis, and our professional perspective. It does not constitute legal, tax, or accounting advice. Regulations vary by jurisdiction, and individual circumstances differ. Readers should seek advice from a qualified professional before making decisions that could affect their business.
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