Stakeholders fault Tanzania for cutting tourism budget

Zawya

7 hours ago

Tanzania's tourism players say the decision to cut down the budget allocation for the next fiscal year will undermine the country's very policy targeting to raise the number of visitors.
The Tourism Confederation of Tanzania (TCT) expressed its disappointment after the budget allocation to the Ministry of Natural Resources and Tourism was slashed from Tsh596.1 billion ($230 million) to Tsh317.4 billion ($122.4 million) in the 2025/26 financial year.
This is despite tourism sector earning Tanzania $3.9 billion in 2024, becoming the highest forex earner for the country.
TCT said in a statement the country will struggle to implement its marketing plans and expanding key enablers for tourism.'This trend undermines the long-term sustainability of the ecosystems and wildlife that are the foundation of Tanzania's global tourism competitiveness,' the TCT statement said.
Tanzania lowered its budget from the initial figure of Tsh57.04 trillion ($22.09 billion) to Tsh56.49 trillion ($21.88 billion), according to figures tabled by Finance minister Mwigulu Nchemba.
For tourism, players say there shouldn't have been a cut. Nature-based tourism accounts for over 70 percent of Tanzania's annual tourism earnings, sourced from tourists visiting wildlife parks and other nature protected areas, beaches, historical and cultural heritage sites.
TCT also listed the 10 percent withholding tax imposed on tourism retained earnings as a harmful tax on reinvesting in upgrades, expansion and staffing. It further argued that foreign exchange controls would also prevent operators from quoting and settling their charges on dollar and euro, a situation which is critical for pre-bookings and packaged group tours.
The government has imposed a control on local transactions using the dollar with a directive to Tanzanian companies, including tour operators, to stick to the shilling. Under the new regulations by the Bank of Tanzania, tourists should use Tanzanian shilling to pay for services.
Read: Tanzania raises budget to $19bn on polls, Afcon costsThe confederation's CEO Lathifa Sykes said that it was curious that the government allocated a big budget for development of infrastructure to host the African Cup of Nations (Afcon) in 2027, but overlooked tourism-related businesses, which would shoulder the logistical burden of the continental event.'You know the situation which hotels, transport companies, tour operators and cultural providers would face without getting support to upgrade or scale up their services in preparation for the 2027 tournament?' she posed.
Dr Nchemba allocated Tsh574.8 billion ($221 million) for the preparations of Afcon 2027, with Tsh179.8 billion ($69 million) to be spent for renovation of stadiums in Dar es Salaam and Arusha.
Read: Exit the Paris Olympics, enter Afcon 2027; We can pull it off!Tanzania, Kenya and Uganda have been selected to jointly host the Afcon games between June and July 2027.
TCT had proposed the establishment of National Conservation Trust Fund, which would mobilse three to five percent of total tourism earnings, then eliminate the current taxes and levies, including the tourist development and bed night levies.
Some 5.3 million tourists visited Tanzania in 2024, official figures show.
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