CHT continues pushback against U.K. airline tax

Prime Minister Dr. Ralph Gonsalves.
AP Photo/Ariana Cubillos
AP Photo/Ariana Cubillos

The Caribbean Hotel and Tourism Association (CHT) is calling on the Caribbean media to maintain pressure on the British government to repeal its controversial Airline Passenger Duty (APD), which, it says is damaging the economies of the region’s countries.

CHTA President Joseph Forstmayr of Jamaica contended the tax had reduced the number of British visitors to the Caribbean by some 90,000 a year in contrast to other European countries without such levies.

He said economic damages leveled by the tax on the islands were even more damaging because U.K. visitors stayed between l0 and 14 days in the Caribbean, which was a considerable amount of revenue lost to regional communities and businesses.

Alec Sanguinetti, director general and CEO of CHTA agreed none of the British government’s aid programs in the region approached the value of tourism to local economies.

He called for innovative ways of protesting the punitive U.K. taxes such as slogans on Caribbean athletes competing in the Olympics in London this summer.

Cash-strapped regional airline LIAT lost US$46 million last year and US$26 million more than in 2010.

And the airline is considering suing Trinidad and Tobago-owned Caribbean Airlines Ltd (CAL) over “unfair competition” under CARICOM protocols.

St. Vincent and the Grenadines Prime Minister Dr. Ralph Gonsalves, chair of the shareholder governments told news conference in Kingstown that while shareholder governments are committed to keeping the airline afloat and recognizes its necessity and desirability, they would have to take some “serious decisions going forward.”

Gonsalves, who is also the CARICOM spokesperson on air transportation, said LIAT would seek legal advice on how CAL “is conducting its business by providing subsidies and coming on the routes, competing with us.”

“They pay just US$50 a barrel for aviation fuel. We pay US$110, $120. Obviously that can’t be correct. I have no problem with CAL coming in our routes, none whatsoever. The competition is fine but the competition has to be on a level playing field,” Gonsalves said.

Gonsalves, along with his Barbados and Antigua and Barbuda counterparts Freundel Stuart and Baldwin Spencer, met recently in Barbados with LIAT’s board and management and unions representing the airline’s workers.

The meeting mandated Gonsalves to communicate concerns about the fuel subsidy to Trinidad and Tobago Prime Minister Kamla Persad-Bissessar’s government, owners of CAL.

“It is our contention that such unfair competition is subversive of the Revised Treaty of Chaguaramas and also of the Common Air Services Agreement in CARICOM and we must address it,” the St. Vincent and the Grenadines prime minister said.

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