Paradise Island, Bahamas – Tax on flights from the United Kingdom to the Caribbean is discriminatory and unacceptable.
That’s the view of the Caribbean Hotel and Tourism Association, which has been lobbying since 2007 against the high levels of the levy.
“It is incredibly expensive,” said Josef Forstmayr, president of the association. “£75 on an airline ticket for the lowest economy service is unacceptable and that goes up to £81 in April. The Caribbean is being penalised.”
He said the private sector body had worked with the Caribbean Tourism Organisation, which represents the public sector, to present a 50-page paper to the British government, which outlined the impact of the tax. That document proposed a new system in which £2 per short haul ticket would create the same volume revenue and achieve neutrality, but that on 6 December the UK treasury voted to retain the status quo.
The system is calculated depending on the distance between London and the capital city of the destination. For example, London to Washington is closer than London to any Caribbean capital, so the United States is in a lower tax band than the Caribbean. However, flights to the West Coast of the US are in some cases twice the distance, but still taxed at a lower rate than those to the Caribbean.
Director General of the Caribbean Hotel and Tourism Association Alec Sanguinetti said that in a budget speech in April 2011, the UK chancellor George Osbourne had called the duty ‘discriminatory’ and said it needed to be addressed but nothing had subsequently happened.
It was possible that the tax contravened the General Agreement on Trade in Services, so a complaint with the World Trade Organisation may be lodged.
“Since 2007, arrivals from the UK have dropped by 270,000. The European visitor has a longer length of stay, between 10 and 14 days, so the lost visitor spend is obvious,” he said.
Speaking at a news conference at Caribbean Travel Marketplace, Mr. Forstmayr said the UK was busy instituting development funding programmes but these were insignificant when compared to the money that feeds through the tourism chain.
“Send us your visitors; they fill hotels, buy food, visit attractions and drive and fuel the economy. Subsidise airline seats. If you want development and people spending money in the Caribbean, make it cheaper to fly,” he said.
Further, there was a historical colonial responsibility to assist.
“The Caribbean built wealth in pre-industrial England and they are still benefitting from it; we also helped rebuild the UK after the war,” he said. “We deserve special consideration, not a slap in the face … it cannot be that way and I will not accept it. We already know it is disrupting economic life cycles in the Eastern Caribbean and the UK market is very important, for example, to Barbados. They are worried.”
Mr. Forstmayr said that governments adding departure tax to airplane tickets was also unacceptable but that he understood it was often the quickest way for struggling economies to get an immediate revenue flow. It was shortsighted, he said, and a hindrance to travel, but often a last resort.
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