Nicaragua waives VAT on tourism services during September holidays

International

Hotels, hostels and restaurants can join the nine-day tax incentive from September 12 to 20 as Nicaragua seeks to stimulate domestic travel during its patriotic holidays

Nicaragua will temporarily waive Value Added Tax on participating tourism services from September 12 to 20, 2026. The Nicaraguan Tourism Institute (Intur) and the General Directorate of Revenue (DGI) announced details of the measure ahead of the country's National Fair of Patriotic Holidays.

The incentive is intended to encourage tourism activity during a period when many Nicaraguans will have time off. It marks the sixth time the country has implemented this tourism-related tax measure and will be accompanied by a public-sector holiday covering the same nine-day period.

Tourism businesses can register for the VAT exemption

Hotels, hostels and restaurants are among the tourism businesses eligible to participate. Companies wishing to join the scheme must register through the DGI's Electronic Tax Window.

Roger Deshon, Director of Information Technology and Systems at the DGI, said the registration procedure had been improved to make participation faster and easier for taxpayers.

The exemption is not therefore presented as an automatic VAT suspension across the entire tourism industry. Businesses need to participate in the programme in accordance with the procedures established by the tax authority.

Tax incentive targets travellers and tourism businesses

Intur sees the measure as a way of supporting tourism companies while reducing costs for families, visitors and tourists travelling around Nicaragua during the holiday period.

Félix Sánchez, head of National Promotion at Intur, encouraged tourism businesses to participate in the initiative. The authorities expect the measure to stimulate travel and spending across the country's destinations during the patriotic holiday period.

The VAT exemption was initially announced on August 21 by Nicaragua's co-president Rosario Murillo, with Intur and the DGI providing further details on September 3.

Public-sector holiday runs from September 12 to 20

The tourism initiative coincides with an extended holiday for state employees. The Presidency announced that public-sector workers will be off from September 12 through September 20 for the country's patriotic celebrations.

Combining the extended break with the tourism tax incentive is intended to increase domestic travel and generate additional economic activity for hotels, restaurants and other businesses serving visitors.

For Nicaragua's tourism industry, the nine-day period therefore represents both a fiscal incentive and an opportunity to capture additional demand generated by the national holidays.