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That UK Air Passenger Duty

By David Jessop

CaribWorldNews, LONDON, England, Tues. Nov. 17, 2009: Let me make no apology for re-visiting the issue of Air Passenger Duty (APD), the British tax measure that continues to divide the Caribbean and the United Kingdom.

It has become a defining issue in the weakening UK/Caribbean relationship, with its outcome likely to demonstrate how much importance the UK places on it’s ties with the region and the hundreds of thousands of citizens and voters who make up the Caribbean Diaspora in the U.K.

For much of the last week, Caribbean tourism ministers have been in London attending the annual trade show, World Travel Market (WTM). This is an event at which buyers and sellers strike deals on the marketing of Caribbean destinations and holidays. It is little noticed in the region but one of a small number of international occasions that determine from year to year the viability of Caribbean tourism through commercial deals that make viable an industry that has become the largest employer of labour in the Caribbean outside of the civil service.

For Caribbean Tourism Ministers, attendance at WTM this year has been a little different. In addition to participating in industry events, promotions and investment seminars, they have been engaged in a dialogue with the British Government, Members of Parliament, the Caribbean Diaspora, the media and others on the tax that has been placed on all travel out of the U.K. and which discriminates against the Caribbean in favour of the U.S.

For those who do not know, APD is an allegedly green measure aimed at taxing aviation`s carbon emissions.  Originally introduced by the UK Government in 1994, it imposes a flat rate tax on all passengers departing from UK airports. As of November 1, however, the UK introduced four distance-related bands. For the Caribbean this means that anyone travelling in coach/economy from the UK now pays 25 per cent more in tax and will pay 87 per cent more from 1 November 2010 with higher rates of tax applying in other classes of travel.

Extraordinarily, the measure has the effect of favouring the US over the Caribbean for what Britain describes as `reasons of administrative ease`. It does so by determining that all of the US and Hawaii, in band B, is `closer` to London than all of the Caribbean which is in Band C.

The measure is particularly damaging to the region in economic terms at a time of falling visitor arrivals as a result of the global recession; especially as the UK is the leading tourist market for many Caribbean nations.

During the week there were meetings with members of both Houses of Parliament, shadow ministers in the opposition parties and activists in the Caribbean Diaspora. At these it became clear that because of the exceptional if loosely co-ordinated campaign mounted by the Caribbean Diaspora in the UK, the region had significant political support everywhere other than in the British Treasury.

The most important of these exchanges took place with the British Treasury Minister responsible for APD, Sarah McCarthy Fry. The meeting was facilitated by one of the Caribbean`s friends in Government, Dawn Butler MP, who is of Jamaican background and who as a Minister in the Cabinet Office has been quietly supportive at the highest levels.

The meeting was a first in as much as it demonstrated a Caribbean unity of purpose of a kind not often seen. Those participating from the region were John Maginley, Antigua`s Minister of Tourism, who is also the present Chairman of the Caribbean Tourism Organisation (CTO); Edmund Bartlett Jamaica`s Tourism Minister; Senator Allen Chastanet, the tourism Minister from Saint Lucia; Glynis Roberts MP, Grenada`s Tourism Minister; and Richard Sealy MP, the Minister of Tourism from Barbados. In addition Hugh Riley, Secretary General of CTO and Enrique de Marchena Kaluche and Alec Sanguinetti, respectively the President and Director General, Caribbean Hotel and Tourism Association, were also there.

According to those who attended, Caribbean ministers put forward a robust economic and political case as to why the Caribbean should be re-banded.  They noted the irony that the measure was being applied to the most tourism dependent region in the world and to nations with no or low carbon emissions. They suggested there may be a basis for re-banding based on the distance of Bermuda and the rule of common interest; an approach that Bermuda would support.

For her part the British minister explained Britain`s thinking but took a hard line: any revision to APD would need to be revenue neutral and have to conform to issues of equity contained in the 1944 Chicago Convention on international aviation. She would look at other options but was doubtful. She raised the new and worrying point for the Caribbean that distance banding provided a useful environmental signal in preparation for the inclusion of aviation in Europe`s emissions trading scheme in 2012.

Those present were left with the distinct impression that fear of alienating the US legally was at the heart of the British Treasury`s unwillingness to change its stance.

However, despite these high level exchanges it remains the representations of ordinary British people of Caribbean descent that are having the most potent influence on the UK Government.

 Members of the Caribbean Diaspora in the United Kingdom are asking by letter and by email in large numbers where their Members of Parliament stand on this issue.

From conversations with community activists it is becoming clear that as the new tax begins to bite and their anger grows (nothing is more motivating than a pocket book issue at a time of recession) it will be an issue when they go to vote in a general election expected in May or possibly March of 2010. This could be significant as for the most part the Caribbean community in the UK live in marginal constituencies where in number they often exceed the sitting member`s majority.

Soon the British Prime Minister will travel to the Commonwealth Heads of Government Meeting in Trinidad. There in addition to Commonwealth and global issues he and his ministers will discuss a range of issues with Caribbean Heads.

If the British Prime Minister wants to send a simple message to the Caribbean that Britain still cares and recognises the contribution that the region and its usually silent Diaspora have made to British life, the answer is simple: reband APD for the Caribbean.

David Jessop is the Director of the Caribbean Council and can be contacted at david.jessop@caribbean-council.org. Previous columns can be found at www.caribbean-council.org.