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Chastanet defends air tax

CAROL MARTINDALE, [email protected]

Chastanet defends air tax

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CASTRIES, St Lucia – Tourism Minister Allen Chastanet has dismissed criticism about the recent introduction of a US$35 tax on airline tickets insisting the new fiscal measure is on par with other regional states and will not deter travellers.
“St. Lucia’s airport tax was one of the lowest in the region for a very long, long time.  As a matter of fact when you look at the tax in its entirety, which will be about EC60 dollars (US$22.20)  it would be very similar to a lot of the other islands.
“In fact there are three islands that are still going to be higher than St. Lucia and there is a bunch of islands that are between EC$50 (US$18.50) or 60 dollars, so in terms of competitiveness it is not going to put us in any different position than with those countries,” Chastanet told the Caribbean Media Corporation, (CMC).
The Airport Development Tax which went into effect from May, 1, will be collected by all airlines. The funds will be used to finance the US$140 million re-development of the Hewannorra International Airport, south of here.
Opposition Leader Dr. Kenny Anthony has criticised the new measure saying it will result in St. Lucians having to be pay the highest rate of taxes to travel in the region.
But Chastanet, who has been an ardent advocate for lower airfares to boost intra-region travel, also knocked suggestions that the new tax will increase already high fares.  He made it clear that there is wider solution which should be considered.
“If in fact the region wants to see cheaper airfares,  there has been a proposal put forward by the Caribbean Tourism Organisation (CTO) for the San Juan Accord which call for a single space to be created within CARICOM which means that we would not have to charge departure taxes to each other because we would be considered one single airspace and that would require the participation of everyone.
“So I don’t think anyone island holding back on its taxes is going to solve intra-regional problems,” he added.
Chastanet also took issue with the regional airline LIAT that earlier this week informed that “taxes and charges paid on LIAT tickets may in some instances represent more than 50 per cent of the ticket price”.
LIAT also said the new tax would be applied to in transit passenger but Chastanet said this was not the case.
“That is completely wrong. Not only do they not only have to pay the tax when they are in transit, anyone who is in transit within the first 24 hours is exempt from the tax.
“So St. Lucia’s policy and strategy to be able to develop a hub at Hewanorra airport is very much still in sync and we will make St. Lucia one of the cheapest airports to be able to use.
“So for example, a person coming in from St. Vincent who will use Hewannora as a hub will not have to pay departure tax either way coming in or going out whereas if when they are going to Barbados because they don’t have an exemption within the first 24 hours they have to pay the departure tax, “the Tourism Minister noted.
Chastanet also said that St. Lucia does not have a Value Added Tax (VAT) like many other islands.
“So when you take the total taxes into consideration it is quite substantially higher than what St. Lucia is charging, “he told CMC. (CMC)