Tourism Taxes Will Stifle Growth in Africa

THE International Air Transport Association (IATA) urged the African Union (AU) to reject proposals for new taxes on air travelers and hotel guests.

If implemented, the taxes would threaten the livelihoods of millions of African citizens and negatively impact the economies of African nations.

“The proposed tax can be likened to killing the goose that lays the golden eggs. Eight million jobs in Africa depend on aviation, an industry that also delivers an US$80,5 billion contribution to the African economy. Aviation brings business, including tourism to the continent,” IATA said on Friday.

“And the same aircraft carry African goods to global markets. Making tourism and trade more costly may promise a narrow, short term gain for the AU treasury, but experience has shown that such taxes ultimately result in a vicious downward spiral ending in long-term pain across the economy,” said Tony Tyler, IATA’s Director General and CEO.

“Just look at the experience of Belgium, Ireland and Netherlands, to name only a few, that have tried to go down this road in the past and that have been forced to reverse themselves once they saw the impact of such taxes on their economies and societies.”

Globally more than 51% of tourists arrive by air, a proportion that is even higher for Africa. Africa is already among the most expensive places for air travel and trade.

Additional taxes will simply push visitors to alternative destinations. If demand falls, connectivity will be imperiled, with wider consequences for Africa’s economy, Tyler said.

Instead of treating passengers as cash-cows, African Union governments should implement policies that encourage greater intra-African air connectivity, and facilitate the construction of world-class aviation infrastructure that will deliver sustainable economic and social benefits, he said.

Source : The Namibian