Tourism minister reacts to increases in APD

Grenada’s Minister for Tourism, Civil Aviation and Culture, Alexandra Otway-Noel, has expressed her disappointment, following British Chancellor of Exchequer, George Osborne’s Autumn Statement regarding increases of the Air Passenger Duty (APD) for passengers flying from Britain.

This comes at a time when, generally, UK arrivals into the Caribbean are in decline.

In addressing the rise in APD, Osborne’s statement said that the rise, which is expected to take effect from April 1, 2014, will increase the cost of medium and long-haul flights from Great Britain.

According to estimates, this essentially means that a family of four travelling economy to the United States will pay £276, up from £268, while the APD would move from £332 to £340 if they were travelling to the Caribbean. Moreover, those opting for premium economy, business- or first-class cabins, will be required to pay double the sum.

It serves to note that this is the sixth time in several years that the British APD has risen.

The Grenada Tourism Minister said that she is disappointed that the decision to follow through with the tax increases was carried out in spite of the lobbying done by Caribbean tourism officials for the British to halt the APD augmentation.

She said that the increases will continue to have serious implications on the tourism sector. Persons in the Diaspora will continue to find it difficult to travel to the Caribbean to visit their family and friends.

“This tax is keeping families apart,” the tourism official said.

Otway-Noel lamented the unfairness of the banding structure, as the taxation imposed on travel to Hawaii is less than that to the Caribbean, because of the capital city of Washington being closer than the Caribbean, for example.

“We understand that the British government has a right to tax its citizens but all the Caribbean region is asking for is a level playing field, so that we can compete. The APD tax was originally implemented as an environmental levy and the banding structure is based on that. All we ask is that the tax be standardised,” the tourism official said.

The proposed rise of the APD will impact negatively on the Caribbean tourism industry and is a cause for concern for every Caribbean destination, as tourism is the number one income earner and employer in the region and traditionally the UK has been one of the strongest markets.

The female government minister anticipates this increase will further negatively impact the Caribbean’s current difficult economic situation and sees the need to reach into new markets to offset this unfortunate situation.

Otway-Noel was recently part of a delegation that met with the Treasury Ministry in Britain while on her recent trip to the World Travel Market.

Several ministers and Caribbean tourism officials have lobbied the British government over the tax that, for several years has been on the rise.

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