“New taxes could have ADP effect, Atherley warns”

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Leader of the Opposition Bishop Joseph Atherley has warned the Barbados Labour Party (BLP) Government that its introduction of new taxes on the bread and butter sector could have similar fallout as the controversial British Air Passenger Duty (APD).

In 2010 when that increased tax was imposed by the British government on its citizens travelling to regions such as the Caribbean it caused a major slump in tourist arrivals to Barbados. The tourism sector has seen only a minimal recovery, mainly over the last three years.

And addressing the Lower House during debate of the Airport Service Charge (Amendment) Bill, 2018, on Tuesday, Atherley cautioned that new taxes imposed by the Mia Amor Mottley-led Government in the June Mini-budget had the capacity to derail these gains.

The measures included the introduction of an Airline Travel and Tourism Development Tax of US$35 for passengers flying within CARICOM and US$70 for those flying outside CARICOM; a hotel room tax of US$2.50 per night for B Class properties and apartments, US$5.50 for A Class and US$10 for luxury resorts; a ten per cent tax on homestay programmes and a levy on tourism services.

The ex-BLP Member of Parliament cautioned his former colleagues that the negative impact was a prime reality that could not, or should not, be ignored.

He said this was especially critical in light of Barbados already losing market share to other Caribbean rivals in traditional source markets like the United Kingdom.

Atherley added that in 2014 there were 214 000 UK arrivals to Barbados compared with the 199 000 to Jamaica. While in 2016, 216 000 Brits chose Barbados and 205 000 Jamaica; and last year the numbers were narrower, with 222 000 choosing Barbados and 217 000, Jamaica.

“We have to exercise caution when we introduce these service charges because they affect price. Leisure travel is more sensitive to price, and then destination choice becomes something to consider by the traveller,” he said.

The Opposition Leader suggested that the airline rather than the traveller should be targeted to carry some of the heavy lifting. (SDB Media)