The Caribbean Tourism Organization proposed an alternative banding scheme for Britain’s controversial Air Passenger Duty that calls for a simple two-tier tax system, one for Europe and one for the rest of the world, instead of the four bands now in effect.
In a report turned over to British government officials, CTO Chairman Ricky Skerritt said that “dividing the world into two zones creates a more equitable relationship between the distance traveled and the tax on emissions.”
Currently, Band A covers Europe; Band B, the U.S.; Band C, the Caribbean; Band D, the rest of the world. The tax is figured on the distance traveled and the impact on carbon emissions; the further the distance, the higher the tax.
Travelers to the Caribbean (Band C) from the U.K. now pay close to $240 per person in APD on top of the fare, while travelers to the U.S. (Band B) pay approximately $190 in APD.
"The APD tax clearly is a barrier to travel and tourism. We are not happy with any aspect of it. The tax discriminates against long-haul travel and is unfair because it penalizes destinations where there is no alternative to air travel. We are urging the British government to consider a simple rebranding of the whole process,” Skerritt said.
“The new proposal is a revenue neutral way to change the tax bands so the British government still can collect revenues but not damage tourism-dependent countries around the world,” said Hugh Riley, CTO secretary general.
What the CTO proposes is that all destinations in Bands C and D be moved into Band B, the U.S. band.
Economy-class passengers on short-haul flights (within Europe) would be taxed an extra pound (approximately $1.60) on top of the 24 pounds ($38) APD now charged, given the latest increase on Nov. 1.
Travel from the U.K. to the Caribbean (the current Band C) and to the rest of the world (Band D) would move into Band B and all travelers in the new Band B would pay the same tax.
The APD report, “The Impact of Air Passenger Duty and Possible Alternatives for the Caribbean,” was compiled by the CTO at the request of the British Treasury following a September meeting in London between British officials and a delegation of six Caribbean tourism ministers.