The Tourism Fund has directed owners of serviced apartments and homestay units to pay the requisite tourism levy within 30 days.
In a notice dated Tuesday, February 27, the body established under the Ministry of Tourism noted that the orders were in line with the Tourism Act which requires various entities offering accommodation services to remit levies based on income generated every month.
As stipulated in law, the levy payable is 2 per cent of income generated per month for accommodation, and the sale of food and drinks among others.
Serviced apartments are similar to short-stay rentals, however, for these units, some employees are deployed to attend to the guests' needs.
Homestay units, on the other hand, comprise Kenyans who charge guests hosted at their homes.
"Tourism Fund notifies all serviced apartments to comply particularly with Order 2 of the Tourism Levy Order which provides that: There shall be paid by the owner of Tourism Activities and Services Specified in class A & B enterprises, a levy at the rate of two per centum (2%) of gross receipts from the monthly sale of food, drinks, accommodation and all other services.
"Please note that Serviced Apartments, Homestays and Villas fall under class A & B enterprises in the Ninth Schedule," read the notice in part.
Further, the Fund noted that failure to comply with the directive would attract a heavy fine.
"If any person fails to pay any amount payable by him by way of the levy on or before the date prescribed by the Levy Order, such person shall be liable to an instant penalty of Ksh5,000 and, thereafter, to an additional penalty of three per cent of the amount of the levy due, for each month or part thereof during which the amount due remains unpaid," read the Tourism Fund regulations.
Kenyans running serviced apartments countrywide were further advised to register their businesses with the Tourism Regulatory Authority.
No penalties would be effected within the 30-day grace period granted to the businesses.
However, the government will institute legal action against non-compliant businesses after the window lapses.
