On October 22, President Luis Lacalle Pou announced that borders will remain closed during the summer. In support of precautions against the pandemic and observing the growing development of the disease in neighboring countries, the president focused on the development of domestic tourism for this season.
Uruguay is a destination chosen annually by more than three million foreigners, who bring in around 1800 billion dollars to the country, which represents 8% of the GDP. The sector not only generates this income, but also enables the development of 127.000 jobs.
Taking these figures into account and knowing the importance of tourism for the economic development of the country, what measures does the government propose for the development of domestic tourism? Are there other measures that could facilitate the entry of foreign property owners?
The government's incentive for domestic tourism
The Minister of Tourism, Germán Cardoso, announced a series of measures aimed at encouraging domestic tourism during the summer season. These measures will run from December until April 4, the last Sunday of tourist season.
The first measure announced was a zero VAT rate for the hotel industry, and a 0-point VAT discount for the restaurant industry and car rentals. Minister Cardoso also announced another measure that "has to do with workers linked to the hotel and restaurant industry. For each new worker hired or reinstated, a monthly discount of 9 pesos per worker will be applied to their contributions." A credit system will also be implemented for those needing to inject capital into their businesses. In addition, there will be an exemption from personal income tax on summer rentals.
Cardoso explained that the necessary measures are being analyzed and work will continue on taking actions together with the Chamber of Tourism to obtain more benefits for tourism activity.
Electronic bracelets: an option to allow the entry of foreigners
Faced with the loss that the closure of borders implies for tourism in the Department of Maldonado, the departmental director, Luis Borsari, proposed to the Vice Minister of Tourism, Remo Monzeglio, an idea to allow the entry of non-resident foreign tourists. Borsari proposed opening the borders for those owners who do not have residency by implementing a control system through an electronic bracelet. This system would allow monitoring that tourists comply with the mandatory quarantine without leaving their residences.
In addition to these potential new tourists, there would be a significant number of Uruguayans living abroad and foreigners with residency. Borsari also takes into account the almost 20.000 new inhabitants who settled in Punta del Este and its surroundings during the pandemic.
Industry experts say the option of allowing entry to non-resident owners could help make a difference this summer season.
Another survey also indicated that there is interest on the part of Argentines in entering the country to make investments, such as buying property, and even to experience a medium-term residence.
Sources: Montevideo Portal, La Nación.
