Industry leaders have expressed concern that many tourism businesses are not contributing to the Tourism Marketing of South Africa (TOMSA) levy despite benefitting from its initiatives.

Anton Gillis, Co-Founder of the Hospitality Asset Management Company and CEO of Kruger Gate Hotel, has been particularly vocal, saying contributions should not be voluntary and calling out establishments that are not contributing to the levy.

“These same hoteliers are quick to complain and criticise yet refuse to be part of the solution,” Gillis wrote in an opinion piece for Business Day. He emphasised the 1% levy is not a financial burden for businesses as it is passed on to consumers.

Fund administrator and South Africa’s apex private-sector tourism body, the Tourism Business Council of South Africa (TBCSA), says more contributions would enable it to tackle more of the critical issues tourism operators face.

The levy was first introduced as the Tourism Marketing Levy in 1996 – aimed at using private-sector funding to bolster South African Tourism’s budget and position the newly democratic country as a tourism destination in international markets.

As it evolved, the TBCSA also introduced the Collaborative Fund, which sets aside some of the money for specific projects such as air access initiatives, industry transformation and safety and security.

Tshifhiwa Tshivhengwa, CEO of TBCSA, says around 500 tourism businesses currently contribute to the fund. TBCSA data indicates, in 2023, R166m (€8.7m) in levies was collected – 7% was allocated to management fees. The biggest contributors to the fund were hotels (R126m/€6.5m), car hire (R27m/€1.4m), game lodges (R5.6m/€291 000), resorts (R5.2m/€270 000) and travel agencies (R1m/€52 000).

Gillis says, with over 5 000 graded establishments in South Africa, this isn’t good enough.

“Factor in all the other kinds of businesses that are supposed to pay and it’s clear only a small fraction do so.”

Tshivhengwa added: “It is a small number compared to how many are graded in the accommodation space. If all of us participated, we would be able to do more projects that are critical to the growth of our industry.”

The number of contributors dropped during the pandemic years but, he points out, this has picked up again to pre-COVID levels.

“The number is growing. It’s just not growing fast enough. All the major hotel groups, bar a few, are contributing but there are lodges, apart-hotels, small businesses and B&Bs that are not.”

Whether businesses contribute or not, they’re still reaping the benefits, Tshivhengwa said.

The levy helped fund the recent Trevor Noah destination marketing campaign, which delivered a return on investment of R8 (€0.4) for every R1 (€0.05) spent and reached over 230 million people in nine monitored markets, according to the TBCSA.

Gillis says, referring to Kruger Gate Hotel: “As an independent hotel, our marketing budget only stretches so far. It is highly unlikely that we would ever be in a position to fund a TV commercial for the Chinese market. However, if the TBCSA had to deploy funds to such a marketing awareness initiative, we would all benefit.”

Tshivhengwa cites investments in Air Access in Gauteng and Cape Town and the tourist safety initiative in the Kruger National Park as examples.

“If we address safety in the Kruger National Park, everyone benefits. If we contribute towards bringing more tourists to South Africa through Air Access, that impacts everyone.”

The TBCSA approaches potential contributors individually to encourage them to join, according to Tshivhengwa, and the levy is highlighted through roadshows and partnerships with the Tourism Grading Council and provinces.

But Gillis believes contributions shouldn’t be voluntary.

“Surely it should be mandatory for all graded properties. You shouldn’t be able to benefit from government business if you don’t contribute.”