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Retailers call for talks over 2pc tourism levy payment

Lewis Njoka @PeopleDailyKe

Retailers have called for further deliberations with the Tourism Fund on how best to implement the two per cent tourism levy without overburdening the sector which they say is already heavily taxed.

Retail Traders Association of Kenya Chief executive  officer Wambui Mbarire said retailers were operating in a very tough environment, hence, the need to agree on the best way to implement the levy without hurting the sector as it was already constrained financially.

Tourism Act of 2011 requires owners of regulated tourism activities and services to pay two per cent levy to the Tourism Fund (TF) for use in developing tourism.

Mbarire said when the law was originally crafted, it was not targeted at retailers such as supermarkets, hence, the need to define it to make clearer to whom it is applied and how exactly it is supposed to be implemented.

“We have always wanted to comply with the law but seek to do it in manner that is agreeable to all parties. We also need to understand how exactly we fit in as many of us retailers view ourselves as outsiders on matters tourism,” she said.

Mbarire was speaking during a tourism fund stakeholders forum at a Nairobi hotel yesterday.

Collection efforts

Speaking at the same forum, Tourism Fund Chairman Alphonse Kioko asked retailers to support the levy collection efforts, saying resources were needed to grow the tourism sector.

“Attracting tourists is easy. However, retaining them requires that we provide high quality services, hence the need for these trainings that we carry out,” he said.

He said Kenya, like other tourist destinations, is moving towards ecotourism, and promoting it to source markets would require resources, hence the need for stakeholders to co-operate in paying the levy.

Kioko promised that the Tourism Fund will be more creative to improve its service delivery, saying the resources mobilised would be used to support all tourism stakeholders, noting that the sector was already robust and looking at imminent growth.

“Judge me and my board of trustees after three years and you will see that our promises are not mere political statements,” he said.

The levy was originally established under the 1972 Hotel and Restaurants Act, Cap 494, which has since been repealed.

The 1972 Act targeted only hotels and restaurants. However, in 2015,  TF roped in villas, apartments, restaurants and home-stay facilities as well as hostels and supermarkets running restaurants to pay the levy.

As per the 2011 Act, two per cent levy is charged on the gross sales emanating from the sale of accommodation, food, drinks, and all services offered in establishments to whom the law applies. The levy is paid on a monthly basis.

Resource mobilisation

Tourism Fund uses the money collected from the levy to market destination Kenya through Kenya Tourism Board, support its resource mobilisation efforts, and improve training and capacity development efforts through Kenya Utalii College.

The levy is also used to support protection services, tourism information management and crisis management among other related activities.

The Fund is currently refurbishing the Ronald Ngala Institute in Kilifi as part of its capacity building efforts within the tourism industry.

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