Oman Tourism Development Fund on anvil

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A new Tourism Development Fund (TDF) designed to support Oman’s Tourism Ministry’s increasingly important mandate in driving economic development and employment generation is expected to be established before the end of this year.
The move is part of a substantial portfolio of tourism related projects and initiatives being progressed through to implementation by the Implementation Support & Follow-up Unit (ISFU), set up under the auspices of the Diwan of Royal Court to accelerate the Sultanate’s economic diversification.
“Tourism tax is a vital method of raising the funds needed to support the tourism industry as it paves the way for the country’s diversification plans and makes Oman a go-to destination for tourists from around the world,” said ISFU in a report.
“By establishing an independent Tourism Development Fund under the Ministry of Tourism, as per the Tourism Law, this initiative will see the share of tax funds allocated to the (Ministry) increased,” it noted.
The 4 per cent Tourism Tax presently levied on tourist-related entities is channelled to the Ministry of Finance’s government fund which, in turn, distributes it among the Ministry of Tourism (60 per cent), Royal Oman Police (20 per cent) and Ministry of Heritage and Culture (20 per cent). The Tourism Ministry, however, is looking to increase its share of the Tourism Tax proceeds through a reallocation of the percentages, according to ISFU.
The Unit is working with the Ministry, as well as the Ministry of Heritage and Culture, Ministry of Finance and Royal Oman Police, on the “activation” of the Tourism Fund. This is sought to be done by providing a clear mechanism for the process, based on which the requisite approval from the Ministry of Finance will be obtained.
A working group set up in the wake of the Tourism Lab held in 2017 had proposed a mechanism for setting up a Tourism Development Fund. It also developed the relevant documentation required to activate the fund.
“The Ministry of Tourism (MoT) has also been able to obtain Ministry of Finance (MoF) approval on opening a bank account under the name of the Tourism Development Fund; However, MoT is now working jointly with MoF on finalising the mechanism and activating the fund,” it said.
ISFU, in line with its remit, is currently following through on the delivery of more than 35 projects and initiatives in the tourism sphere — one of eight economic sectors identified by the Omani government as particularly prospective in accelerating the Sultanate’s economic diversification.
They include plans for, among other things, nature parks, adventure activities, rolling events calendar, waterfront leisure developments, F&B hubs and activities, e-Visa and e-concierge initiatives, destination marketing efforts, establishment of a Tourism Sector Association, and an Oman Tourism and Conventional Bureau.

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