Local Hotel Tax

GOVERNING LAW:

The local government (amendment) (No.2) Act 2008, Cap 243, & Practical guide for implementation of Local Hotel and Local Service tax was developed by Local Government Finance Commission.

What is Local Hotel Tax?

This is a tax levied and paid by room occupants of a Hotel per room per night. According to the Act, a Hotel is defined as a house intended for accommodating travelers or visitors for payment.

Hotel by implication refers to :-a Hotel, An Inn, A Guesthouse, A Serviced Apartment, A Motel or Any Suitable Structure for Commercial Residence

WHY ARE YOU PAYING?

It’s a legal requirement for any person staying as a visit at a hotel/ lodge/ guest house to pay Local Hotel Tax as provided for by the Local Government Act Cap 243.

Local Hotel Tax: was introduced in order to regulate hotel activities within the urban authorities and to raise revenue to enable the urban authorities to offer services such as: – Roads & Drainage maintenance, garbage collection etc. therefor revenue raised through, among other sources is intended to fund the cost of these services.

HOW IS LOCAL HOTEL TAX LEVIED AND PAID?

Hotel owners/ management are obliged to levy and collect Local Government Hotel tax on behalf of Nansana Municipal Council. Local Hotel Tax Collections are recorded on a daily basis in an NMC till book issued by Nansana Municipal Council.

All entries in this book are expected to reflect the fair view of transactions taking place at the Hotel.

Hotel Records shall be accessed by Authorized Revenue Officers of Nansana Municipal Council on request during official time.

Upon approval of the records presented, the Authorized Revenue Officers should issue Payment Advise Forms (PAFs) generated from IRAS  to the Hotel Owners/ Managers for payment.

It should be noted that, it is the Hotel Management that is responsible for the collection of Local Hotel Tax.

Payment shall be made to the designated Banks.

PAFs can be obtained from the Revenue office at the nearest Division office.

WHAT IF I DO NOT PAY?

In cases where part of or all of the Local Hotel tax collection remains un remitted at the end of a financial year, the hotel owners/ managers will be required to pay the outstanding tax including a surcharge of 25% within two months of the notice.

If the Hotel owners/ managers fail to comply, the Authority may sue the hotel in the courts of Law.

HOW MUCH WILL EACH ROOM OCCUPANT PAY IN TERMS OF LOCAL HOTEL TAX?

The Local Government Hotel Tax shall be levied on room occupants per night according to the categories of the hotel as follows:

No. HOTEL CATEGORY RATE OF LOCAL HOTEL TAX OCCUPANT/ GUEST (IN UGX)
1 Five and Four star hotels US $ 2 per room per night
2 Three, two star hotels and other hotels charging above 50,000/= per night 2000/= per room per night
3 Hotels, lodges and Guest Houses charging 10,000/= up to 50,000/= per night. 1000/= per room per night
4 Hotels and Lodges which are charging less than 10000/= per room per night 500/= per room per night

DOCUMENTS USED TO RECORD AND/ OR MANAGE HOTEL TAX INCLUDE:

  • Nansana MC Collection Till Books
  • Hotel Receipt Books
  • Hotel Registers
  • Daily Return Summary Forms Showing Daily Rooming Lists.
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