Business

Travel agents raise alarm over impact of higher taxes, policy changes

Joseph Kithitu, chairman of the Kenya Association of Travel Agents (KATA), addresses their AGM and Convention at a Mombasa hotel on June 7, 2024. (Photo: Farhiya Hussein/EV)

By Farhiya Hussein | Tuesday, June 11, 2024

KATA leaders also proposed the full implementation of existing policies to expand the tourism business.

The Kenya Association of Travel Agents (KATA) has raised the alarm over increasing taxes and policy changes, noting they threaten to cripple the sector.

At KATA's Annual General Meeting and Convention, which took place in Mombasa on June 7-8, Chief Executive Officer Nicanor Sabula expressed members' unanimous concern about disruptions to travel operations by member organisations.

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"Like all other businesses, we are facing some difficulties with the new economic regulations that the government is introducing, especially in terms of taxes," Sabula said.

"When taxes are increased, the business environment becomes more challenging because everyone is under significant financial strain. Our travel sector often faces threats when the cost of doing business rises because the first thing companies will do is reduce travel."

KATA leaders also proposed the full implementation of existing policies to expand the tourism business.

They pointed out that the current state of airports and tourist hotels has not met international standards and recommended improvements to make these sectors more attractive to tourists.

KATA Chairman Joseph Kithitu noted that expanding the tourism economy takes time as it involves assessing goals, infrastructure, compliance with international standards, and other such factors.

"We are pleased with ongoing policies, but what is needed is speed in implementation so that we can quickly elevate our business. We compete with other countries, and those countries are also working hard, so we must also work hard to bring first-time tourists here, and quickly, so that we can benefit," he said.

Noting that tax increments and policy changes are the key challenges hindering their progress, the leaders also called on the government to give stakeholders more time to develop appropriate strategies to improve the organisation's services.

"If our tourism becomes more expensive, people will [explore choices] not only here in Africa but also worldwide, so let's not make our tourism expensive and difficult," Kithitu said.

"Let's strengthen our economic offerings, build our hotels, roads, and airports, and attract investors who will bring in new resources so we can grow our economy. We should also invest heavily in domestic tourism because that is a major economic driver."

Meanwhile, KATA has signed a memorandum of understanding (MOU) with national carrier Kenya Airways to increase its market presence for national services and enhance competitiveness within the sector and with other organisations in the East African region.