Tourism players welcome policy delay, but insurance concerns persist

Dar es Salaam. Tanzania’s tourism industry has cautiously welcomed the government’s decision to delay implementation of the proposed mandatory $44 travel insurance charge for foreign visitors.

However, stakeholders warn that key concerns remain unresolved, particularly regarding the potential harm to the sector’s reputation and international competitiveness.

The proposal, part of the 2025/26 national budget, aimed to amend the Insurance Act (CAP 394) by requiring all foreign travellers to purchase a locally issued travel insurance policy upon entry into the country.

Although authorities framed the initiative as both a safety measure for tourists and a revenue opportunity for the insurance sector, it faced swift and strong opposition from the tourism industry.

The Tourism Confederation of Tanzania (TCT), the apex private-sector body for the tourism industry, criticised the plan, citing inadequate consultation and a lack of transparency.

Industry stakeholders argued that the charge could be perceived as a “stealth tax,” likely to discourage high-value tourists, undermine Tanzania’s global image, and erode gains made through efforts to position the country as a top-tier travel destination.

Of particular concern was the risk of tourists visiting both mainland Tanzania and Zanzibar being charged twice for similar insurance coverage.

Stakeholders said this would not only confuse visitors but also damage the coherence of the national tourism brand.

In response to these concerns, Finance Minister Dr Mwigulu Nchemba on Thursday, June 26, 2025, announced that implementation of the policy would be deferred to January 2026 to allow for “broader industry consultation and refinement.”

Despite the postponement, tourism players say the underlying issues remain unresolved.

TCT executive director, Ms Lathifa Sykes, welcomed the delay but reiterated that, “Concerns remain... spoiling reputation and unnecessary.”

She linked the proposed insurance requirement to the wider problem of an unpredictable and burdensome tax regime, warning that policies introduced without proper engagement could “undo the progress President Samia Suluhu Hassan has made in reviving the sector, including through initiatives such as The Royal Tour.”

Ms Sykes called on the government to “look at the bigger picture—not just the expected revenue, but also what could be lost.”

A key sticking point for industry leaders is the failure to exempt tourists who already have international travel insurance.

As proposed, the policy would effectively double-charge travellers, particularly those visiting both the mainland and Zanzibar.

Tanzania Association of Tour Operators (TATO) chairman Mr Willy Chambulo also expressed reservations.

While appreciating the government’s willingness to delay implementation, he said he remained “sceptical about it.”

TCT had earlier flagged that the unilateral nature of the proposal—especially without exemptions for pre-insured travellers—could place Tanzania at a disadvantage compared to regional competitors.

Countries such as Kenya, Rwanda, Namibia, and South Africa have opted for more streamlined, traveller-friendly policies or have refrained from imposing compulsory insurance altogether.

Tour operators also raised alarm over the timing of the proposed policy, coming shortly after international concerns about aviation safety in Tanzania.

The sector fears that the move could send the wrong message, suggesting internal doubts about the country’s emergency response systems.

“At a time when the government is working hard to restore credibility with the European Union Air Safety Committee, EASA, and international insurers, this policy risks reinforcing existing concerns instead of alleviating them,” TCT said in a statement issued on June 20, 2025.

“It contradicts ongoing efforts to demonstrate regulatory strength and improve the international perception of Tanzania’s aviation and tourism sectors,” adds another part.

Stakeholders are urging the government to conduct comprehensive consultations and ensure that future policy decisions are informed by dialogue with those who best understand the operational realities of the industry.

While the deferral has temporarily eased immediate tensions, industry leaders say they will continue to push for reforms that balance revenue considerations with long-term sustainability and Tanzania’s positioning in a highly competitive global tourism market.