Trade criticizes plan to hike Jamaica departure tax

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NEW YORK -- The trade is reacting with dismay at Jamaica's decision to raise its airport departure tax by a whopping 24%.

As reported, Jamaica will raise its airport departure tax from $21 to $26, effective June 1. The tax hike is part of the government's new budget that included a 31% jump in gas prices and other tax increases to pay off debt.

The increase in gas prices was partially rolled back on April 27 after it sparked three days of deadly protests that shook the tourism industry. "We believe that Jamaica's action, and other tax increases, while apparently revenue producing, are actually revenue dilutive," said Jeffrey Tolkin, co-president of Travel Impressions in Farmingdale, N.Y.

Tolkin said that Mexico and the Caribbean "have become non-competitive with domestic destinations" partly because of mounting tourist taxes that hurt business. Jamaica raised its airport departure tax from $15 to $21 effective June, 1998.

"We are clearly not in agreement with this plan. We have had discussions about it with the government," said Allen Chastanet, vice president of marketing and sales for Air Jamaica, which operates 160 flights a week to the island, or 54% of traffic. "We are in a major expansion mode in Jamaica. A hike in the airport departure tax at this point would seriously impact us," said Chastanet.

A spokeswoman for the Jamaica Tourist Board said the organization's regional offices have begun advising tour operators and travel agents of the tax increase.

Meanwhile, in the three months before the April unrest, a total of 331,007 tourists -- 221,400 of them from the U.S. -- visited Jamaica, a rise of 6.7% compared to the same period in 1998, the tourist board reported. During the same period, Jamaica recorded 183 cruise ship calls, a 28.9% increase, resulting in 251,530 cruise passengers, a 20% jump, the tourist board said.

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