Caribbean tourism ministers have drawn a line in the sand, demanding that Britain's Air Passenger Duty tax be recalculated and reduced for travel to the Caribbean.
Britain, however, has made it clear that it will neither roll back nor change the controversial tax, which took effect Nov. 1.
British lawmakers tout the tax as an environmental measure aimed at taxing aviation's carbon emissions.
Under the new tax, the British government has a four-tier banding system, set at intervals of 2,000 miles from London, with the tax amount based on the distance between London and the capital cities of the countries where the flights land.
The U.S. is in Band B (2,000 to 4,000 miles from London), so the amount of the tax is calculated on the distance from London to Washington, 3,600 miles. Caribbean countries are in Band C because their capitals are between 4,001 and 6,000 miles from London.
At issue is the competitive nature of the different tax rates. Previously, only two bands were used to tally the tax: $16 for European economy-class travel and $62 ($130 in premium classes) for all other destinations, including the Caribbean.
Now the distance-based duty on air tickets from the U.K. to the Caribbean is $82 in economy and $164 in premium class.
In November 2010, the fees will jump to $123 in economy and $247 in premium class.
Several Caribbean tourism ministers met recently in London with U.K. members of Parliament and were informed that the tax would not be scrapped.
Allen Chastanet, minister of tourism for St. Lucia, said that a paper has been submitted to the British government requesting that Caribbean countries be viewed as one group, so that the tax for flights to the region be calculated on the distance between London and Bermuda (3,445 miles), the closest island to London. Bermuda also is in Band B, the same as the U.S.
Caribbean ministers plan to bring up the matter at the next meeting of the International Civil Aviation Organization in Trinidad, from Dec. 8 to 11.
"We are leading a charge with the Americans and also the Canadians to say that this is an illegal tax. The British government is charging a tax over people's airspace. We are going to try everything we can to show that this is not the way forward," Chastanet said.
Travelers from the U.K. to the Caribbean last year totaled 1.2 million, according to the Caribbean Tourism Organization. Visitor arrivals through September to the region's various islands are down anywhere from 5% to 19%.
Based on the increased costs of travel now in effect from the U.K. to the Caribbean, there is a strong likelihood that visitor traffic from England will continue to decrease, according to Chastanet and other ministers.
Tourism ministers have been joined in their lobbying efforts by dozens of hotel firms and other industry associations, including CTO, the Caribbean Hotel and Tourism Association, the European Tour Operators Association, the World Travel and Tourism Council and IATA.
"Taxes won't reduce emissions, and making travel more expensive will not stimulate the economy," said Giovanni Bisignani, IATA's director general and CEO.