Govt Throws Another Spanner in the Works
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April 26-May 3 2017 I No. 2443 SOUTHERN AFRICA’S TRAVEL NEWS WEEKLY TRAVEL NEWS WEEKLY TNW8101SD FEATURE FEATURE NEWS DOMESTIC AIRFARES CONFERENCE VENUES THE GULF VAT cut possible All the top airport locations Ensure clients stay within the law INSIDE Page 2 Page 11 Page 15 Govt throws another spanner in the works TARYN NIGHTINGALE specialises in submitting tenders for TMCs. She says the State has also S IF cutting overrides and introduced the idea of regulating TMCs’ commissions on government fees: “If a department has three TMCs Abusiness wasn’t enough, who’ve tendered for a contract, the departments are now allowed to State can request that an average fee negotiate a “market-related” service be charged.” fee with tenderers. Most agents think the decision Effective April 1, government’s new is a fair one, but doubt whether its Preferential Procurement Regulations, implementation will benefit the industry. 2017 (which govern procurement An agent who preferred to stay pending the promulgation of the anonymous says the changes are TCAA hits the road, My Cousin! Procurement Bill later this year) possibly to combat Treasury’s initial stipulate that the State may not award concerns about agents within the public The Tourism and Culture Authority Abu Dhabi (TCAA) will be hitting the tenders to TMCs whose service fees sector. “TMCs weren’t transparent and road with Barry Hilton as MC of its upcoming roadshow from May 23-25. are not market-related. If the tenderer were deliberately low in their pricing to TCAA will kick off the show in Johannesburg at Summer Place, then move scoring the highest points is not willing catch business,” she says. on to the Hilton Durban and end at the One&Only Cape Town. The event to negotiate a market-related fee, the “The decision is a good one, provided starts at 09h00 and ends at 12h30 daily. Pictured are (from left) Johnathan State could cancel the tender. the trade and Treasury understand the Hollard, trade and MICE executive, and Jean Martins, country manager for Mariska South, owner of 9° South, principles and joint objectives of putting SA of TCAA. Photo: Shannon Van Zyl works as a tender consultant and To page 2 Brazen fraudsters get smarter Two-thirds of booking sites CANDICE MAY scammed agency, has asked to remain anonymous and says one of have dodgy prices FRAUDSTERS are becoming bolder the agency’s existing corporate clients TESSA MARSH way it was calculated, was not clear; in their approach to scam TMCs by contacted her saying he had referred 25% of the websites didn’t specify impersonating clients via telephone. A the corporate client’s UK-based office A RECENT study conducted by the that statements about scarcity (e.g. Pietermaritzburg-based agency recently to the agency so that they could issue European Commission and EU only two left) applied strictly to the fell victim to a scam that began with flight tickets. “The client provided us consumer protection authorities, website and not the supplier. a client referral and ended with the with the contact’s name – ‘Mr Richard found that 235 of the 352 booking A similar screening doesn’t agency losing R250 000. Lawton’. Due to our relationship we websites screened (two-thirds) had appear to take place in South Africa This is not the first agency to be trusted the referral,” the agent says. prices that were unreliable. and the Advertising Standards conned out of a large sum of money Later that afternoon, Mr Lawton In just over 32% of the cases, the Authority only investigates when after following up on a referral. In emailed the details of the 11 travellers price first shown was not the same a complaint is lodged, leaving the 2014, a Johannesburg agency lost and said it was a highly urgent request. as the final price. Almost 21% of SA market vulnerable to fraudulent almost R2m in four days and in The agent then issued the tickets for the sites had promotional offers offers. Ramesh Jeenarain, md of October last year, the same agency flights from Ghana that same day – six that were not really available and on World Leisure Holidays, says the almost fell for a similar stunt. on Kenya Airways and five on Emirates. 30% of sites, the total price or the To page 20 The agent from the most recently To page 2 at the door step of the world’s great falls Website: www.africansunhotels.com | Tel: +27 (0) 100030079 TNW7741 NEWS VAT cut on domestic fares possible TESSA MARSH He says EU countries like but I doubt this would be Germany, France, Italy and significant. Some airlines in HERE is “triple tax Greece have implemented this market offer well priced dipping” when it comes the zero-rated tax policy on fares,” she adds. Tto airfares, says Shadow flights, which was followed by SA Airlink ceo, Rodger Minister of Tourism and a significant increase in travel. Foster, says: “If air tickets Member of Parliament, James Chris Zweigenthal, ce become VAT exempt, what TNW6153SD Vos. He plans to present a of Aasa, says on domestic about VAT on all the input policy to parliament within the tickets, VAT is charged on costs? If the entire supply year proposing the axing of VAT the fare and on charges chain is VAT exempt, there ® Rubes By Leigh Rubin on domestic air tickets. in the ticket tax boxes. He would be a cost saving to the “There needs to be a understands the concern consumer.” reduction in aviation taxes to over double or triple dipping Treasury says because VAT improve the competitiveness but says it is practised in is mainly a revenue-raising of South Africa as a value-for- other sectors. He believes instrument that flows into the money destination for local this would be a very hard national revenue fund and a and international tourists.” He sell given the other priorities final consumption tax, applied says while several taxes are in SA and pressure for VAT on top of all other charges grouped together as airport to be removed on basic that may include other excise taxes, only approximately commodities. taxes (air passenger departure 20% goes to the airport. “If June Crawford, ceo of Barsa, taxes), it does not agree with we exempt air travel from says the VAT Act would need the notion of triple dipping. VAT then an immediate cost to be amended and domestic Treasury says it does not saving of 14% will be realised airline tickets zero rated. support increasing the scope by travellers. This step will “I doubt that SARS would of current VAT exemptions or not require new legislation entertain this, as air travel is concessions as these have but merely an amendment to not an essential. Any reduction not proved to provide any existing legislation that will in costs on air travel goes assistance to poor or specific expedite implementation.” towards stimulating demand sectors. Another spanner in the works From page 1 government business. services, the spokesperson this in place,” says Sailesh “I recently saw a tender added. “What a precious little sweetie! Why, he Parbhu, md of XL Nexus where a TMC was quoting In terms of the National looks so scrumptious I could eat him up!” Travel. He says these are service fees equal to what Travel Policy Framework fair play; price parity and was being charged in 2006.” (NTPF), which will be transparency. Meanwhile, Treasury says published before the end of Rachel Penaluna, business it is tackling late payments April, departments have until manager of Sure Maritime by departments. “The September 30 to adopt and Travel, agrees but says: Department of Planning adapt it as their minimum “There’s no clear standard Monitoring and Evaluation standard to develop similar in travel because the and National Treasury are or more stringent policies, industry isn’t regulated. Will continuously intervening in the spokesperson says. government benchmark a cases of non- compliance “The NTPF is issued as market-related fee against by encouraging government an Instruction in terms the lowest price? Then we departments to comply, of Section 76(4)(c) of the just have the same problem and also requests one- Public Finance Management of agencies undercutting on-one meetings with Act. Departments that do • China • Tibet • Nepal • Vietnam • Cambodia • Laos each other,” she says. responsible departments not comply by October 1 will • Myanmar • Japan • India • Sri Lanka & beyond Mariska also handles with their HODs,” said a incur irregular expenditure Contact details: Tel: 010 001 9998 | [email protected] tenders on behalf of legal spokesperson. and will be dealt with wendywutours.co.za firms where tenderers don’t Treasury was also looking accordingly. TMCs who don’t TNW7745 hesitate to charge a fair fee at specifications for the comply will be in breach of and government doesn’t use of lodge cards that their contract and may face Founding Editors: question it, she says. But departments could use being put on the database of John H Marsh (1914-1996) Leona Marsh (1923-2003) agents seem desperate for when they tendered travel restricted suppliers.” EDITORIAL TRAVEL NEWS WEEKLY Editor: Taryn Nightingale [email protected] www.etnw.co.za Features Editor: Sue van Winsen [email protected] Brazen fraudsters get smarter Published by Publisher: Anton Marsh [email protected] Travel & Trade Publishing (Pty) Ltd Deputy Publisher: Natasha Schmidt [email protected] From page 1 they could not make contact exploits the trust they Printed by Juka Printing (Pty) Ltd Journalists: The next day, Mr Lawton with the cardholder. I then have with clients.