Tanzanian tourist lobbies want taxes harmonised
Tuesday February 26 2019
Tourists in Tanzania’s Serengeti National Park. The country is a popular tourist destination as it is home to Africa’s tallest mountain, Mt Kilimanjaro and the Ngorongoro Crater. FILE PHOTO | NATION
Tanzanian tourist business executives are lobbying parliament to harmonise policies and levies in the industry.
The Tanzania Association of Tour Operators (Tato) and Hotel Association of Tanzania (HAT) met House Speaker Job Ndugai to push for legislation that will harmonise all levies charged in the industry.
They expressed concerns over different taxes and levies imposed on tourism, which they said have made Tanzania tourism industry a non-competitive destination.
Each tour operator in Tanzania is subjected to 32 charges, including business registration fees; regulatory licence fees, entry fees, income taxes and annual duties for each tourist van.
There are 12 levies related to business registration and regulatory licences as well as 11 duties for each tourist vehicle per annum and nine others.
The operators said the administrative burdens of completing the issuing of a licence, tax and levy paperwork alone imposes a heavy cost on businesses in terms of time and money.
TATO chairman Willy Chambullo told The EastAfrican that the most pressing issue that the two associations raised with Mr Ndugai was harmonisation of different levies and duties imposed on the industry.
“We are looking for frequent discussions with the government to see how a tourist operator can clear the duties and levies at one stop centres,” he told The EastAfrican.
“The industry needs the intervention of the august House now more than ever before,” said TATO Trustee and founder chairman Merwyn Nunes.
According to him, taxes and levies imposed on the industry were making the business environment unfriendly.
New structure
The Ministry of Natural Resources and Tourism last year, introduced the new Tourism Agency Licensing structure with foreign tour operators with 10 to 30 tourist vehicles are now paying a yearly Tanzania Tourism Business Licence of $5,000 per year.
Other charges are $7,5000 for 31 to 50 vehicles, and $10,000 from 51 vehicles and above — all applied to foreign tourist companies operating in Tanzanian wildlife parks and other tourist sites.
Under the newly introduced levies and duties structure, local operators owning one to three safari vehicles will pay $500 per year for business licence, while those operating four to 10 safari vehicles are charged $2,000 and those with up to 50 vehicles and above paying $3,000 respectively.
Parliament has endorsed a motion to upgrade five game reserves before gazetting them to full national park.
Minister for Natural Resources and Tourism Dr Hamisi Kigwangala said game reserves set for development and gazetting to national parks are Biharamulo, Burigi, Kimisi, Ibanda and Rumanyika. The five game reserves together cover an area of 4,702 kilometres.
Tourism is now the country’s leading source of foreign currency, accounting for 25 per cent of total export earnings, a World Bank report says.
The World Bank has predicted that tourism revenues for Tanzania could growth to $16 billion annually by 2025.
Looking to attract three million tourists in the next two years, Tanzania has switched its marketing plans to focus on new emerging sources in China, India, the Pacific Rim and South America.
Tanzania is now targeting the Chinese tourists after launching campaigns in five key Chinese cities.