I cannot stop raising my voice as both an investor and activist in the tourism sector on actions that derail the progress of the industry that benefits all of us.
The government of The Gambia’s recent proposal to increase the departure/arrival tax from $20 to $25 as proposed in this letter reference AVJ 27/09/02.PART 21/ (53) of 13th May 2024 addressed to operators.
This proposal has sent shock waves in the sector which has warranted me to ask, “If Government of The Gambia wants to kill the goose that lays the golden egg”?
No doubt they have held back with the proposed increase until further notice.
A recently concluded study on the tourism industry in Gambia has identified the following challenges:
1. Lack of destination recognition/attractiveness
2. Dwindling product quality
3. Undiversified products and source markets
4. Limited air access
5. Over reliance on International Tour Operators (ITOs)
6. Climate change and environmental degradation affecting the country product
7. Weak Statistical Base to inform policymakers among others.
The outcry of stakeholders over the past five years has been the poor performance of the sector which has been seriously affected by the withdrawal of Thomas Cook, advent of Covid 19 and the controversial introduction of the airport arrival and departure tax which has virtually paralyzed the sector recently.
The sector has been grappling with serious challenges of QUALITY BEDS that are attractive to the clientele. Let’s remember that most of the hotel operators affected are cash strapped to undertake the necessary renovation to upgrade their standards. The seasonality of the industry with short seasons is another impediment. It was suggested before the OIC that the investment in the 419 so call Radisson Blue 5-star Hotel would have taken care of necessary renovation to meet up the quality beds needed for the conference. However, this expectation fell through, and the rest is a sad history.
The sorry indebtedness of most of our hotels does not stop with the commercial banks but concerns also the Municipalities. At one point a couple of hotels were placed under the hammer at the behest of the KMC for default in settlement of rates. However, it is only after the timely intervention of The Director General of The Gambia Tourism Board who appealed to the courts to convince them that this would paint a bad picture of the industry if the sales went through. The Director General and The Ministry did not know of the sale until I broke the news to them.
My intention in this article is to demonstrate that all is not well with the tourism sector and the sector should not be regarded as a milking cow with no palliatives and actions put in place to promote this very important activity. Government therefore should not kill the goose that lays the golden egg.
If we consider the tourism sector and its contribution in the overall economy of the country both in employment, revenue generation, foreign exchange earnings and above all the linkages with the agricultural sector, the contributions are huge and should be taken seriously.
This present article is to highlight the key sometimes self-inflicted harm that government is causing to the industry. The “Maatey” policies “in raising taxes randomly without due consultation with other associated Ministries and sector partners, does not help, on the contrary, it will kill the sector
Government ‘s decision conveyed in the letter referenced.
AVJ 27/0902/PART 2/ (53} dated 13TH May 2024, captioned “INCREASE OF SECURITY FEE FOR THE PROVISION OF CIVIL AVIATION SECURITY SYSTEM” has opened a can of worms in the tourism industry that we are all grappling with up to the present time.
I would venture to proffer the following comments regarding this untimely action:
A. The content of the letter addressed to Operators and Airlines states among others that as from 1st July, the Airport Tax will be increased from 1st July 2024 to $ 25.
B. Oddly enough, the letter of instructions addressed to the Operators was not discussed or copied to the appropriate Ministry – the Ministry of Tourism & Culture nor was it communicated or The Gambia Tourism Board.
C. We wonder whether the Civil Aviation Authority operating under the Ministry of Works and (championing the increase) is working for same government? It seems the left does not know what the right hand is doing in the case of this bombshell. It is indeed sad to see this happening currently in which
proper administrative procedures and analysis, and consultations precede were ultimate decision-making prior actions taken.
D. The institution of the payment the $20 was still controversial and has led to the withdrawal of many tour operators especially the Nodic group which are one of the most loyal and constant operators who pay well, and the group was one of the bigger operators remaining in our destination.
E. The standpoint of stakeholders is that they are not against an increase, but the timing is wrong. It should come when the sector has recovered or recovering. The guidelines of IATA and ICAO clearly spelt out what needs to be done in the case of plans to increase taxes.
F. The most important observation is as follows: The civil Aviation Authority letter Ref: AVJ 27/0902/PART 2/ (53} dated 13TH May 2024 addressed to SN Brussels is requesting them to seek approval from IATA to include the charges in their tickets and get a security code for it . This clearly does not make sense to me as the original letter Ref AVB 145/176/01 (75) of 29th March 2023 was addressed to AITA seeking direct clearance .
I am adding a few important notes from IATA & ICAO worth considering and use in any submission to be made.
-IATA’s activities include:
Ensuring that new and existing taxation measures are fairly applied and adequately consider the economic and social ramifications
· Advocating against measures that result in double taxation
· Advocating against taxation measures that unjustly target the industry, where the resulting tax revenues are not reinvested in air transport related services and infrastructure.
· The International Civil Aviation Organization (ICAO) position on governments taxing aviation
· Over the years, the ICAO Council has undergone a number of revisions to the policies on taxation of international air transport, and has adopted a consolidation Council Resolution: ICAO’s Policies in the Field of Air Transport (Doc 8632, 3rd Edition, 2000).
· Doc 8632 makes a conceptual distinction between a charge and a tax: i) a charge is a levy that is designed and applied specifically to recover the costs of providing facilities and services for civil aviation; and “a tax is a levy that is designed to raise national or local government revenues which are generally not applied to civil aviation in their entirety or on a cost-specific basis”.
· Considering that the recommendations in the ICAO policies have been developed by major international conferences, there is a strong moral obligation for all ICAO Member States to ensure that any imposed taxes and charges conform to the policies and philosophy set out in the ICAO policies. Therefore, ICAO Member States are also urged to avoid imposing discriminatory taxes on international aviation, as well as avoid double taxation in the field of air transport.
· Ticket taxes – best practices
· Since the 1980s, many governments have required the airline industry to collect taxes, fees, and charges from consumers on their behalf. These amounts have increased from less than USD 1 billion annually to more than USD 64 billion today, resulting in significant administrative and financial burdens for the airline industry and higher costs for consumers.
· ICAO has long expressed concern regarding the proliferation of inefficient and burdensome taxes on air tickets that not only increase the cost of air travel, but equally create a negative economic impact on the sustainable development of air transport and the protection of the customer. Ticket taxes imposed on passengers by governments or other charging authorities may reduce the demand for air travel, which is highly sensitive to price changes. This, in turn, will hamper economic growth. IATA has compiled the official airline industry recommended processes for taxes and charges, and best practices on dealing with governments and authorities. (Source IATA & ICAO).
We must assess whether the services and facilities our airport currently offers that can warrant any tax increase at all. With all due respect to the renovation of the airport, the standard of facilities and services have left much to be desired with all the amounts spent.
Our current market situation does not need an increase in taxes, but we should instead try to possibly freeze our taxes for a year or two to attract investment in air access. Increase in taxes we all agree is a must but the timing of the taxes and the utilization of it is key as referred to by AITA. These notes and guidance are key in any airport operations. It seems our airport operators have not given particular attention to this important recommendation even though they are signatories to the Banjul accord.
WE ARE FURTHER GUIDED BY THIS LETTER WHICH SUPPORTS AND ADVOCATES FOR GOOD ADMINSTRATIVE PRACTICES IN ALL AIRPORT SERVICES AND OURS IS NO EXCEPTION:
IATA – NO to D1200 Passenger Levy.
Mr. Fansou Bojang
Director General
The Gambia Civil Aviation Authority Banjul, The Gambia
Email: [email protected]
Date 10/05/2023 Ref MS/1502/07
Your Ref: AVB 145/176/01 (75) Implementation of revised passenger charges at Banjul International Airport.
Dear Mr. Bojang,
This serves as acknowledgement to, and receipt of the letter dated 29th March 2023, from The Gambia Civil Aviation Authority (GCAA) concerning implementation of revised passenger charges at Banjul International Airport.
The contents of the letter are noted albeit with disappointment as the process followed is still flawed and not aligned to ICAO user charges setting policies and principles espoused in Doc 9082. This is being further reiterated by ICAO per their State Letter1 which calls for signatory States to respect these policies and was reiterated also at the Joint ICAO-IATA Africa Regional User Charges Workshop conducted in Dakar; Senegal, 13-14 March 2023, to which the esteemed DG of The Gambia CAA was in attendance.
During a side meeting held between IATA and the GCAA in Dakar, IATA shared a spreadsheet whereby financial data was to be populated for interrogation in a follow up consultative meeting which we anticipated to take place prior to finalization of any of the charges. This has not been shared with IATA and the airlines, and it is also not clear where we can access the audited financial performance. Whilst we appreciate the figures appended to the letter from the GCAA, this is nonetheless not sufficient as we require proper information on OPEX, CAPEX and traffic developments.
The fees are deemed to be too high and add to the already numerous charges and fees that have been imposed by The Gambia. These are “Immigration Charges” and therefore are discriminatory versus any person arriving in the Gambia by any other means of transport (for instance car, bus, boat).
The Safety and security remain our number one priority cannot be compromised, and we appreciate collaborative enhancements and efficiencies in processes and infrastructure developments, but in the absence of meaningful user consultation and transparent financial information, the airline industry is not able to evaluate and appreciate the cost-relation between the provision of the new safety services and the level and structure of related fees.
IATA’s position remains that the industry should not be charged for security2 as this is a state’s responsibility and for the new Safety Fee and the PSC increase, the rationale behind the levels still needs to be provided, as well as the breakdown of the activities to be funded over the respective oversight areas.
We are also yet still to agree on the requested performance indicators that need to be put in place to measure the quality of service, productivity, and cost effectiveness of the measures.
We again implore The Gambia CAA to conduct a due and proper consultative process in alignment and adherence to the aviation industry principles. We remain at hand for further support and assistance.
Yours sincerely,
Kashif Khalid
Regional Director Operations, Safety and Security – AME- IATA
Africa & the Middle East
My question on the content of the letter is as follows:
A. WHY is the Government of The Gambia not ably to supply the information requested? It is alleged that Security Port has the information and they have refused to give this information to The Government for onward transmission to IATA.
B. UNFORTUNATELY: The government of The Gambia it seems have no say in the agreement with Security Port as they have a monopoly of all financial information as alleged. We are in serious trouble with this company and wondering when will this agreement come to an end? May Allah help us to get rid of this milking cow that has no benefit to The Gambia our homeland.
C. To conclude, the tax burden on the sector at this stage is unwarranted and is killing the sector slowly. I would like the government of the Gambia to give due consideration to the tourism sector and give it the necessary support it deserved for it to be sustainable and not to let it die a natural death. The death of the sector will certainly bring more on undesirable social problems to The Gambia which the country will not be able to cope with.
Once more consider the airport tax and its increase is seen as a blight and not a blessing. The Ministry of Works & Interior and The Civil Aviation Authority must ensure that whatever motive they have in the increase of Airport Taxes IF genuine should be in consultation with The Ministry of Tourism & Culture. There should not be any hidden agenda in the service of The Gambia Government in which we all belong and cherish. The sector needs a blessing for its revival and survival. God bless Gambian tourism.
The author is a former Director of Tourism, Co-founder /Co Proprietor and Head of School of the Institute of Travel & Tourism of The Gambia and a Tourism Consultant.
