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Delay in tax decision


marciadottin, [email protected]

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BRITAIN’S controversial Air Passenger Duty (APD) – which has caused much distress to Barbados and other Caribbean tourism destinations, and had seemed set for abolition under the new Tory-Liberal Democrat coalition government – has received a stay of execution.Newly appointed Chancellor of the Exchequer (Minister of Finance) George Osborne signalled the delay of a decision over the future of the APD during his emergency budget on Tuesday last week. “The government will explore changes to the aviation tax system, including switching from a per-passenger to a per-plane duty, which could encourage fuller planes,” Osborne said. “Major changes will be subject to public consultation.”The Telegraph newspaper reported recently that a report was likely to arrive in the autumn.Meantime, chairman of the Caribbean Tourism Organisation (CTO) John Maginley, who is also Antigua and Barbuda’s tourism minister, has been reported as saying regional countries would have to take the matter further.“It’s clear that because our economies are so heavily reliant on tourism, this tax is effectively a tax on our countries’ exports. We’ll be reviewing the position with organisations such as the World Trade Organisation,” he said, adding that the tax was also unfair to many families in the Caribbean community in Britian who travelled frequently to the region.Maginley said that while the Caribbean understood the British government’s need for tax revenue, the current structure of the APD was “unfair and unbalanced”.According to the Telegraph, in November the APD is scheduled to rise from £22 (BDS$65.80)to £24 (BDS$71.78) on short-haul flights, from £90 (BDS$269.19) to £120 (BDS$358.92) on flights between 2001 and 4000 miles, from £100 (BDS$299.10) to £150 (BDS$448.65) on flights between 4001 and 6000 miles, and from £110 (BDS$329.01) to £170 (BDS$508.47) on flights over 6 000 miles, under plans put in place by the previous Labour Government.The Telegraph said any move to a per-plane tax could lead to even higher taxes, particularly if Liberal Democrat manifesto plans were adopted.Earlier this year, Telegraph Travel revealed that under the Liberal Democrats’ manifesto proposals to make the switch to a per-plane duty, passengers on short-haul flights would pay up to 75 per cent more as part of plans to generate £5.3 billion each year from the tax.APD has already risen by up to 325 per cent since 2006, and leading figures from the aviation industry say further increases will hit families hardest and lead to a decline in both inbound and outbound travel, while doing nothing to help the environment.ABTA, The Travel Association, welcomed Osborne’s decision to examine aviation taxes more closely, but expressed disappointment that APD would still increase in November.“While we broadly welcome the proposed switch from air passenger duty to per plane duty,” said ABTA chief executive Mark Tanzer, “It is essential that the levels and the mechanisms are set correctly so that ordinary people are not taxed out of flying.”This week, a survey carried out by the website HolidayExtras.com revealed that a third of British travellers would cancel overseas holiday plans if an extra £30 in tax were added to their airfare. (AB)

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