Additional VAT charges raise Kenya’s park fees

ENTRANCE fees for
Kenya’s national parks
have increased after the
introduction of additional VAT
charges in the country.
The new charges, which
came into effect on January
1, are published on the
Kenya Wildlife Service (KWS)
website.
In September last year
a number of previously
exempt tourism services,
including game drives and
conservancy and park fees,
were subjected to a 16% VAT
charge as part of the VAT
Act 2013.
The Act was met with
criticism from the trade,
which cautioned that
increasing VAT charges
would negatively affect
tourism to Kenya.
John Gakinya, md of Trails
of Africa Tours and Safaris,
expects the increased fees
to definitely impact tourism
because they raise the
average spend per day for
tourists visiting the parks.
“Bearing in mind that
tourism is a global industry
with destinations competing
between themselves, if the
countries around us do not
charge VAT on park fees,
then we will look more
expensive in the market.”
However, John said the
long-term effect of the
charges would depend on
what industry received in
return for the increment.
“If the funds are used to
improve the product then
in the long run the industry
players benefit,” he said.
The Kenya Association
of Tour Operators (KATO)
is lobbying government to
reconsider the additional
charges. The association
said it would also seek
clarification on safaris that
were sold before the new
rates came into effect.
Fred Kaigua, KATO ce, told
Travel News Weekly that,
while a lot of negativity had
been expressed at KWS,
the Kenya government
implemented the additional
VAT, not KWS, who made
representations against the
tax to no avail. He added
that KWS had also absorbed
some of the additional
costs. “Granted there are
some categories where [the
new] fees exceed 16%, but
on average the increase has
been maintained within 16%.
“It is most unfortunate that
the government of Kenya
saw fit to impose VAT on
conservation fees at a time
when the tourism industry
is going through a slump,”
said Fred. He added that
Kenya was now one of the
few countries in Africa taxing
conservation. “Conservation
is very expensive and in
most cases does not even
manage to pay for itself.
To tax it further is adding
insult to injury and will
most certainly have a very
adverse impact.”