fp Turks and Caicos

While the Turks and Caicos Islands works on increasing tourism from the U.K. with a new longer runway at the Providenciales International Airport, taxes on U.K. flights to the Caribbean will increase 8 percent in April.

The Air Passenger Duty (APD) will go up from £50 ($78) to £75 ($117) per person. That means a family of four flying to the TCI will have to pay £300 ($467) in duty compared with the current rate of £200 ($312), or £160 ($249) last year.

The TCI, a British Overseas Territory, attracts only about 1 percent of its tourists from the U.K. and the rest of Europe. One problem has been that the airport’s runway wasn’t long enough to allow long-haul flights to come directly to Providenciales, requiring costly layovers.

The increase in the APD will cut into savings realised by direct flights that are possible with the longer runway that was recently completed.

“This decision demonstrates the U.K.’s complete disregard for the future economic prosperity of the Caribbean and the role of tourism in development,” the Caribbean Hotel and Tourism Association (CHTA) said in a statement on the decision not to relax the increase on Caribbean travel.

“The decision taken by the U.K. Treasury is in total contrast to the stated policy of the U.K.’s desire to improve its relations with the independent Caribbean and Britain’s Overseas Territories in the Caribbean.”

Different duty is applied to four different regions or bands, but the Caribbean is grouped with more distant regions of southeast Asia and South America. That means travelers will pay more in taxes to come from the U.K. to the Caribbean than to anywhere in the U.S., including Hawaii.

“Given that the U.K. chancellor himself drew attention to the discrimination of the APD band structure vis-a-vis the rates for the Caribbean and the USA in his 2011 budget statement, it is incomprehensible that he has subsequently chosen to continue this economic discrimination against the Caribbean and its community in the United Kingdom,” the CHTA said.

The CHTA said both British Airways and Virgin Atlantic have announced that they will reduce the number of flights to two major Caribbean destinations in April when the APD increases.

“The CHTA would like to ask, how many flights need to be cut and how much damage has to be done before the U.K. recognises the punitive impact of this tax on our exports and the future economic development of the Caribbean?” the CHTA asked. “The British government has heard the arguments, but it does not care enough to do the right thing by the Caribbean.”

TCI Airports Authority CEO John T. Smith said the APD puts European Union carriers at a competitive disadvantage, but it might not affect all travelers.
“The likelihood is that some if not most of the EU carriers may well consider adsorbing some if not all of this APD,” Smith said. “This will minimise the impact of the APD on price sensitive travellers.”

“We continue to experience a growth in the EU passenger numbers, thanks in part to the continued and recent marketing initiatives of the Tourist Board and hoteliers.