No free ride, warns Sinckler
Minister of Finance Chris Sinckler has warned that the removal of taxes on travel within the region is not a clear-cut matter.
In fact, he is cautioning that the region needs to tread very carefully in the face of calls by a local businessman for a reduction in airport charges and for Barbadian pensioners, 65 years and over, to be exempt from paying such charges.
The call from regular traveler and airline commentator Robert Pitcher comes on the heels of a suggestion from aviation officials from the Organization of Eastern Caribbean States (OECS) for the taxes on air travel within the sub-grouping to be removed.
At a recent meeting in Antigua, the officials zeroed in on the findings of a study on factors inhibiting inter-regional travel. Host Minister of Tourism Asot Michael reported that arrivals from within the OECS to Antigua and Barbuda had declined by five per cent last year.
Pitcher blames the fall off on “the dramatic increase” in the cost of air travel since 2008/2009.
“In fact, the reduction in intra-regional travel coincides with the escalation in ticket prices from those years,” he argued, while admitting that other issues, including security, needed to be addressed.
Arguing that the problem of high travel taxes was region wide, Pitcher said: “It needs removing from Trinidad, Barbados and Guyana. All of the other Caribbean countries [as well].”
He noted that passengers travelling from the Grantley Adams International Airport (GAIA) on LIAT were subjected to a number of fees, including a passenger service charge of US$27.50, a security fee of US$3.20, as well as a ticket tax that varies.
“It was about nine years ago when major upgrades were carried out at the airport that the fee structure changed. I am not saying we should remove it totally,” he told Barbados TODAY.
“The departure fee in Barbados over the years went from $20 to $25, but we more than doubled it. I want them to reduce the taxes to what it was before, to 25 Barbados dollars for people from birth up to age 64. And at age 65, no departure taxes for that pensioner, similar to Trinidad,” he explained.
The businessman said he believed that such a move would encourage more people to travel.
“If you continue to take everything from the consumer, you do not give the consumer any money to spend, so there is no spending power within the country to rejuvenate the industry because you keep taking until one day you can’t take at all,” Pitcher said.
Asked to respond to Pitcher’s comments, Minister of Finance Chris Sinckler, although not dismissing the idea of a reduction in airport fees, warned that it was not a straight forward matter≥
In fact, he said a number of factors had to taken into consideration when determining a new tax or fee structure, including the cost of aviation fuel, wages and the volume of passengers.
“It is not just saying, ‘go to the Minister of Finance or Government and ask that the tax be reduced’. That is okay and that is perhaps desirable, but it is really not as simple as that. So any such desire or intention would have to be seriously studied and considered before any such thing is done,” he warned.
“ . . . So while everyone would welcome a reduction in prices because we want to be able to ensure that regional travel is sufficient to justify having a regional carrier like LIAT and to encourage movement of people and economic and social integration and economic growth and development in the region, it has to be done in a way that does not destroy the bases on which these things have been constructed. So we have to look at it in a holistic way,” he stated.