Conflicting Reactions to APD Increase

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Tourism News

Thursday, 06 December 2012 02:27

By caribarena news

Antigua, St. John's - Antigua and Barbuda’s Tourism and Civil Aviation Minister does not see as much terror in a recent further increase in Britain’s controversial Air Passenger Duty or APD, as does the General Manager of the country’s Hotel and Tourism Association.

The somewhat conflicting reactions from Hon. John Maginley and Mr. Neil Forrester come on the heels of Wednesday’s announcement that British travelers will have to pay two pounds more to visit the Caribbean as of next April.

That latest increase brings to about £83 pounds, the amount that each person travelling from the United Kingdom will have to pay, prompting General Manager of the Antigua Hotels and Tourists Association (AHTA), Neil Forrester, to express alarm.

"Any increase in the cost of a vacation is detrimental to the number of people taking vacation however small," Forrester said. "Whether that impact is going to be huge, probably not, but our UK numbers for this year are still negative compared to last year."

The 2.5 per cent increase in the APD was announced on Wednesday by UK Chancellor of the Exchequer George Osbourne in his Autumn Statement.

Private jets that were previously exempt from the tax will also be affected.

The AHTA general manager said this is a blow for the country since tourism arrival numbers are showing signs of improvement in some areas.

"Tourism arrival numbers are slowly coming back to positive growth. In the November numbers the US market is up 12 percent and with West Jet servicing Antigua out of Canada for the first month we're seeing a 46 percent increase in Canadian arrivals," Forrester said.

He added, "We've seen Virgin and British Airways displace aircraft from the Caribbean to service Orlando and Florida and most importantly with Virgin Atlantic servicing Las Vegas they've seen positive growth in those destinations.”

According to Forrester, "We feel we're being penalised vis-a-vis Orlando and Las Vegas which are other leisure destinations. I don't think the UK is listening to the Caribbean. Where they will, is if there is a lot of British businesses that feel they're suffering because of the APD and speak out."

More than 30 airlines, airports, tour operators, destinations and travel trade associations have mounted an online campaign, calling on the Government to make UK aviation tax fairer.

The latest announced increase was quickly labeled as self-destructive" by the Board of Airline Representatives. BAR Chief Executive Dale Keller said it "takes us dangerously beyond the tipping point where the impact can only be negative to the economy,"

He continued, "The announcement comes as unsurprising from a government that is not listening to the wider industry or international opinion and is self-destructive to its own objectives of attracting foreign investment and tourism."

Mark Tanzer, Chief Executive Officer of the British Travel Association - ABTA- accused the Government of strangling the potential of the tourism industry. "The tourism sector is ready to employ more people and offer genuine economic growth – but to do this we need the Government to look again at higher and higher levels of Air Passenger Duty and back the whole of our sector – domestic, inbound and outbound," he said.

Having branded the APD as discriminatory, Caribbean Governments and regional tourism authorities and their partners have made persistent representation to the UK authorities for the APD to be revised.

But this latest development notwithstanding, Antigua and Barbuda’s Tourism Minister John Maginley has assured the public that the country’s tourism product continues to hold firm.

Commenting Wednesday on the subject, Minister Maginley said he and a contingent of tourism ministry officials had addressed the matter at the recent global conference, but still the UK government refuses to shift its position.

The matter, Maginley said, has gotten so grave that even UK airports are reporting reduced traffic in light of the taxes, and smaller air carrier services in the country have also complained.



On Tuesday the UK coalition government reported to the country for the first time that it was unable to realize promised growth within an outlined timeframe. And the government has promised renewed vigor in realizing its goals.

“What can we do?” Maginley asked in response to Caribarena’s questions on possible new ways of approaching the matter. He pointed out that despite this, the country continues to realize year-to-date growth in US and Canadian markets. Unconfirmed reports about the UK market suggest a current parity with the arrival figures for 2011.

In its present form, the UK’s APD is the highest tax of its kind anywhere in the world. Local tourism industry experts have said that in order for Antigua & Barbuda to continue to receive UK passengers despite the costs, much emphasis must be placed on the experience visitors receive.

A December 5 Travel Weekly report notes widespread concern about the impact of the widely anticipated increase, making clear that they are already under pressure from the “eye-watering” levels of passenger taxes they customers have to pay.

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