Kenyan tourism authorities have rebuffed the move by the Finance minister, Amos Kimunya, to introduce a 16 percent VAT on tourism travel, saying the move will hinder efforts at reviving the sector following post election violence at the beginning of the year.
“This is a very serious matter because it will dampen the tourism sector which on the other hand the government wants to revive,” said Kenya Association of Air Operators CEO Eutychus Waithaka in an earlier interview with the Business Daily.
The industry said the tax was introduced without consultations.
It is expected that the new VAT will be passed on to tourists making packages to the country more expensive and thus less attractive.
Tourism travel has been exempt from taxation since 1994 when it was removed as a way of boosting the industry after another slump induced by the tribal clashes of 1992.
Tourism minister Najib Balala has said he will lead the sector to lobby against the tax in Parliament.