New proposals could raise cost of Kenya’s domestic departure taxes by 150 percent

KENYA’S DOMESTIC DEPARTURE TAX COULD MORE THAN DOUBLE UNDER NEW PROPOSALS

(Posted 18th November 2013)

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The national assembly appears to have revived a proposal shot down during the last parliament which will, if passed, open the door to raise the domestic departure tax from presently 200 Kenya Shillings to as much as 500 Kenya Shillings, making the cost of domestic flights more expensive by as much as 3.5 US Dollars per sector flown.

One and a half years ago was this tax doubled from 100 KShs to 200 KShs under strong protests at the time by domestic air operators. This latest attempt to hit the travel industry with yet more taxes, after VAT added was only a few months ago to a range of tourism services in what could have devastating consequences to the country’s inflow of foreign tourists because of the sharp cost increases, was met with both disappointment and outrage by the tourism industry.

The draft law would, according to the section seen in copy, allow government to decide without further parliamentary approval not only to periodically increase these taxes but also how to split departure taxes, the international departure tax presently stands at US Dollars 40 per passengers, a figure which the source from Nairobi suggested may also be under upwards review, between the Kenya Airport Authority, the principal beneficiary at present, and the Kenya Civil Aviation Authority. The latter has in recent years also incurred the wrath of the aviation industry over sharply raised charges vis a vis, going by one regular and definitely outspoken critic from the aviation private sector ‘not a shred of improvement or better grasp of what the local airlines need and how to make flying, and learning to fly, more attractive to a broader audience. As long as they think that flying a micro light must be regulated like a commercial jet, something is fundamentally wrong with their approach and hiding behind ICAO is exposing them as either liars or as lazy. Lazy because they can apply for exemptions like for instance the US have done, who have the most exemptions in place of any ICAO member country to benefit private and general aviation. Obviously they do not have the understanding or the capacity to do that and we suffer for it while we maintain their grandiose offices and perks with fees and charges which go up all the time for nothing much to show’.

Aviation observers are particularly worried about the attempt to fast track the new bill which would leave precious little time to organize for private sector input and lobbying, leaving the same critic to write in an email: ‘If we as a key sector of the economy have to learn about such attempts from the media or inside informers instead of being copied as a matter of course and invited to comment and testify in parliament with expert opinions, then something is fundamentally wrong with the understanding of how to shape new laws in this country. It is high time that consultations between parliament and the private sector affected by their intended new bills are made mandatory so that they can only decide once they have seen all facts and figures on how their decision will impact on a sector of the economy. THAT would be proper democracy and not the sort of democrazy we are now often seeing. Remember the drinking laws which would have made it a criminal offense for tourists to enjoy their cocktails and wine throughout the day and for our hotels, resorts and lodges to serve them? Sometimes it seems these guys have lost all common sense if ever they had any’..

Ouch comes to mind but considering the way the past parliament tried to increase their salaries and benefits – while for instance neglecting to debate and pass a new amended wildlife act at the time to stem poaching – and how this new parliament has almost instantly on inauguration set out with a similar agenda, totally disregarding civil society’s and their electorate’s opinion, such demands appear legitimate enough to be taken seriously. Watch this space.