Corthay, LaurentLoeprick, Jan2012-08-132012-08-132010-06https://hdl.handle.net/10986/10485A good investment climate for tourism, underpinned by a sound tax regime, can play a central role in a government's growth and development strategy. Yet in many countries, tax systems for the tourism sector are characterized by exemption schemes and instruments that generate little revenue and burden business. This note focuses on the three main issues facing policymakers dealing with tourism taxation in developing countries: fiscal incentives, sector-specific levies, and value-added tax (VAT). It discusses different policy options to encourage tourism investments while ensuring sustainable revenue collection. A good business environment for tourism is essential to support the industry's central role in many countries' development strategies. Investments in the sector, which has significant growth potential among developing countries, can have important positive spillovers on poverty reduction. Tourism is a complex industry of numerous subsectors. It is challenging to define exactly what constitutes a tourism product and how to tax it; tourism is not a single commodity, but rather a collection of many different goods and services provided by a wide range of suppliers. The tourism value chain encompasses a variety of different actors, including hotels, air carriers and transport companies, tour operators, travel agents, rental agencies, and countless suppliers from other sectors.CC BY 3.0 IGOACCOMMODATIONSADDED TAXADVOCACY GROUPAFFLUENT COUNTRIESAIRAIR TRAVELAIRLINE TICKETAIRPORTAIRPORT TAXESAMORTIZATIONBEACHESBROKERAGEBUSINESS ENVIRONMENTBUSINESS ENVIRONMENTSBUSINESS INVESTMENTBUSINESS REGULATIONSCAPITAL ASSETSCAPITAL INVESTMENTCARRIERSCHECKSCOMMODITYCOMPETITIVE MARKETCOMPETITIVE MARKETSCOMPLIANCE COSTSCONSUMERSCORPORATE INCOME TAXCORPORATE TAXCOST OF CAPITALCULTURAL HERITAGECURRENCYDEDUCTIONSDESTINATIONSDEVELOPING COUNTRIESDOMESTIC MARKETSDOMESTIC TRAVELECONOMIES OF SCALEEFFECTIVE TAX RATESEQUIPMENTEXPENDITURESEXPORTERSEXTERNALITIESFARESFINANCE CORPORATIONFINANCIAL BURDENFIRM GROWTHFISHINGFOREIGN DIRECT INVESTMENTFOREIGN FIRMSFOREIGN INVESTMENTFOREIGN INVESTORSFORMS OF TOURISMFUELFUEL CHARGESFUEL TAXGIFTSGLOBAL EXPORTSGOVERNMENT REVENUEGROSS DOMESTIC PRODUCTHOTELHOTEL OPERATORSHOTELSINCENTIVE REGIMESINCOMEINCOME TAXINDIRECT TAXATIONINSPECTIONINSTRUMENTINSURANCEINTERNATIONAL DEVELOPMENTINTERNATIONAL FINANCEINTERNATIONAL HOTELINTERNATIONAL HOTEL ASSOCIATIONINTERNATIONAL TOUR OPERATORSINTERNATIONAL TRAVELINVESTMENT CLIMATEJOB CREATIONLEISURE TRAVELLEVEL PLAYING FIELDLEVIESLEVYLEVY SYSTEMLOCAL INVESTORSLOCAL TRANSPORTMACROECONOMIC ENVIRONMENTMONETARY FUNDNATIONAL PARKNATURAL RESOURCENATURAL RESOURCESOUTPUTSPARKSPRICE ELASTICITYPRICE ELASTICITY OF DEMANDPRIVATE SECTOR DEVELOPMENTPROFIT MARGINSREGISTRATION FEERESORTSRETURNSSAFARISSAFETYSALES TAXESSMALL BUSINESSSMALL BUSINESSESTAXTAX ADMINISTRATIONTAX AVOIDANCETAX BASESTAX COLLECTIONTAX COMPETITIONTAX CREDITSTAX INCENTIVESTAX LAWTAX OBLIGATIONSTAX RATETAX RATESTAX REGIMETAX REGIMESTAX SYSTEMTAX SYSTEMSTAXATIONTAXPAYERSTOUR GUIDINGTOUR OPERATORTOUR OPERATORSTOURISMTOURISM ACTIVITIESTOURISM BUSINESSESTOURISM DEVELOPMENTTOURISM INDUSTRYTOURISM INVESTMENTTOURISM INVESTMENTSTOURISM OPERATORSTOURISM PRODUCTTOURISM PRODUCTSTOURISM SECTORTOURISM SERVICESTOURISM TAXATIONTOURISM VALUE CHAINTOURISTTOURISTSTRANSFER TAXESTRANSITTRANSPARENCYTRANSPORTTRANSPORT COSTSTRANSPORTATIONTRAVEL AGENTSTRAVEL BUSINESSESTRAVEL COSTSTRUETURNOVERVEHICLESVISITORWITHHOLDING TAXWORLD TOURISMWORLD TOURISM ORGANIZATIONWORLD TRAVEL &AMPTOURISM COUNCILWorld Bank10.1596/10485