In a move to strengthen its tourism sector and attract further investment, Rwanda has introduced a 3% tourism levy on hotel accommodations. The initiative, approved by the Cabinet this week, aims to generate revenue for infrastructure development, conservation efforts, and enhancements in the hospitality sector.

Minister of Finance and Economic Planning, Yusuf Murangwa, clarified that the levy—charged at 3% of a hotel’s room rate—aligns with international tourism tax models. “This is a standard practice globally. For instance, if a tourist books a $100 room, they will pay a $3 tourism levy,” he explained.

With hotel rooms in Rwanda increasing from 17,078 in 2020 to 21,232 in 2024, and a target of 35,000 rooms in the next five years, the levy is expected to support ongoing growth. The country welcomed 1.4 million visitors in 2023, a figure anticipated to double by 2029.

Jean Guy Afrika, CEO of the Rwanda Development Board, emphasized the levy’s role in achieving the country’s tourism revenue goal of $1.1 billion by 2029. “This policy aligns with our broader strategy of making Rwanda a high-end, sustainable tourism destination,” he noted.

Rwanda’s tourism ambitions extend beyond leisure, prioritizing Meetings, Incentives, Conferences, and Exhibitions (MICE). The country hosted 77 major events in 2024, attracting over 10,000 delegates in the fourth quarter alone. With MICE industry revenue expected to surge from $95 million in 2023 to $224 million by 2029, the levy will fund infrastructure improvements and event hosting capabilities.

By investing in conservation, green bonds, public-private partnerships, and introducing new tourism products, Rwanda positions itself as a premier global destination, balancing growth with sustainability.