Investors decry Tanzania's plan to increase tourism fees

Tuesday December 19 2017

The Ngorongoro Crater Lodge in Arusha.

The Ngorongoro Crater Lodge in Arusha. Investors in Tanzania’s tourism sector have called for a review of a proposal to raise the licence fees by 100 per cent. PHOTO FILE | NATION 

By PATTY MAGUBIRA
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Investors in Tanzania’s tourism sector have called for a review of a proposal to raise the licence fees by 100 per cent.

Tourism Minister Dr Hamis Kigwangalla recently proposed new fees for the Tanzania Tourism Business Licence (TTBL) and hotel classification to replace the flat rates he scrapped a month ago.

Tanzania has been charging a flat rate of $5,000 for the TTBL for foreign-owned tour companies and $2,000 for locals. 

Local and foreign hotel owners pay $2,500 for grading their accommodation facilities, but all these are bound to change effectively next fiscal year, if not on January 1.

Now, the minister is proposing that foreign investors pay $10,000 annually for 10 to 30 vehicles. Those with 31 to 100 vans will pay $15,000 and those with 101 and above vans will be charged $20,000 per annum.

A local investor with one to three tourist vans will pay a TTBL fee of $200; those with four and 10 vans will pay $2,000; 11 and 50 vans will be charged $3,000; 51 and 100 vans $10,000 and 101 vans and above $15,000.

Investors say the proposed fees are bound to drive them out of business.

“How on earth one can pay $20,000 just for a business licence?” asked one foreign investor, adding that the sudden policy change goes against the 1997 Tanzania Investment Act, which guarantees all investors consistent investment policies.

“We ought to enjoy investment guarantees, particularly a predictable investment climate and consistent policies provided for under the Act,” the investor said.

Tanzania Association of Tour Operators chairman Willbard Chambulo said the government should charge a flat rate for all operators.

The new rates for accommodation facilities will be determined by the number of rooms rather than a hotel’s star ranking.

A hotel with 25-50 rooms will be graded at $1,000; 51 and 100 rooms at $2,000 and 101-plus rooms at $2,500.