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Home Business & Finance

Sierra Leone Business: With about 58% taxes already in place …New $40 Security tax set to kill tourism

by Awoko Publications
23/05/2017
in Business & Finance
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According to the KLM Vice President for Africa a ticket to Europe cost about $300, but after local taxes are added, the ticket is sold to passengers at $825.
This shows that already the local charges and taxes imposed by the Airport and the Transport Ministry amount to 58%, which is more than half of the actual cost of the ticket.
The explanation given by the Transport Minister is that government owes the security contractor ‘Westminster’ some $8 million for security equipment, which they have installed at the airport to counter terrorism etc. To raise the $8 million would require the average 200,000 passengers who pass through the Lungi airport over a one year period to pay $40 each.
However the effect would be disastrous to the economy as already the high cost of airline tickets are forcing passengers to buy outside the country (online), rather than use the local travel agents.
The Travel agents have reportedly refused to infuse the new tax into the cost of the tickets at the counter, and they have reportedly told the Transport Ministry to go to through the International Air Travel Agency (IATA) if they want to have the $40 included in the cost of tickets. This is because they know fully well that IATA is in opposition of any such imposition. This apparently has left the Ministry with the only option of having to collect the $40 itself using a separate counter at the airport.
Already travellers complaining of the high cost of tickets bought in Sierra Leone are traveling by road to Guinea where they buy their tickets for several hundreds of dollars less and then board their flights from there. This has seen a massive drop in revenue from the airline industry, which is already impacting negatively on the collection of taxes.
This effect will not be lost on would be tourists to Sierra Leone. For example if a family of four were intending to visit Sierra Leone and already have to buy their air tickets at $825 which runs up a bill of $3,300 and they have to pay their hotel bills for one week which on the average is $100, which adds up another $2,800 making it $6,100 and even if you skip food and souvenirs another $80 for each would add another $280 making it $6,380, this makes a holiday for 4 in Sierra Leone from Europe cost about $7,000 for a week.
This in effect will make our neighbouring countries more attractive to tourists than Sierra Leone. It also makes their destination more competitive.
At the end of the day online bookings will increase and we will lose out to Guinea and Liberia where such costs are not included in their tickets.
Monday May 22, 2017.

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