Taxation of Aviation Major Threat to Tourism

The Caribbean Tourism Organisation’s outgoing Chairman and St. Kitts and Nevis’ Minister of Tourism Richard Skerritt on Wednesday evening (11th October) stated that International aviation has become a more attractive source of taxation for Governments desperate for revenue, with cash-strapped governments on both sides of the Atlantic looking more to the travel and tourism sector as a way to balance their debt-ridden budgets.  

Skerritt made specific mention of the Airline Passenger Duty (APD) tax imposed by the UK  as an example of ‘taxation gone crazy’. he stated that The structure of the British APD is not only prejudicial to long-haul travel to the Caribbean, but it has sent the level of ticket-related taxes to an unprecedented high, raising nearly 3 Billion Pounds annually for the British Government to use on domestic programs which have nothing to do with aviation. 

He stated that they in CTO believe that aviation tariffs should be kept at a minimum and is of the opinion that tariffs should facilitate the delivery of proper security and better service at airports, and enhance travel-related developments to result in more people traveling, more cargo, and better value for the traveller.

“We disagree with the British Government that aviation should be taxed at unlimited levels for balancing budgets,” he continued.

Skerritt added that despite of CTO’s best advocacy efforts, UK Chancellor George Osborne has maintained his stance towards the Caribbean and is still not inclined to make any adjustments to his present discriminatory aviation tax structure, in which he taxes an airline ticket from London to Hawaii at a lower rate than for a ticket from London to St. Kitts, which is a much shorter distance away. He also pointed out that on the other side of the Atlantic, despite US Federal taxes that already constitute 20% of airline ticket prices, new proposals are pending in the US Congress that include additional travel-related fees. 

“Particularly with the increase in airfares to the Caribbean, consumers who are paying more to get to our region expect more from our destination when they arrive.  This heightened demand by travel consumers for value dictates that we must provide them with the best possible return on expenditure,” he said.

He also voiced his pleasure of the FCCA’s announcement that their operations committee has actively begun exploring ways and means to rebuild summer cruising in our region.

Skerritt also revealed that between 2006 and 2011 in the OECS countries alone, they welcomed 115,000 fewer Caribbean visitors

The Minister of Tourism was speaking at the opening of the Caribbean Tourism Organisation’s (CTO) Conference which is discussing the state of the tourism sector in the Caribbean.

Some 250 delegates are said to have convened in St. Kitts and Nevis for the conference which will run from 10-12 October at the St. Kitts Marriott Resort.




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