To tax or not to tax? The cruise issue rages on

Ben Kilbey

To tax or not to tax now that it the question. The question on virtually everybody’s lips in the Caribbean. For as long as Caribbean Travel News can recall, deciding if a levy should be added to the cost of a cruiseline ticket has been the hot topic at conferences hosted in the region. Recently the topic has come under scrutiny as some analysts have suggested that Caribbean states have opted to drop the proposed taxation amid fears of a possible backlash from the cruise industry. The cruise industry is a vital business for the Caribbean reagion and islands can be devestated by the effect of cruise companies ‘pulling’ from their region, one specific area is St. Croix in the USVI. The head of a ministerial-level committee set up by the Caribbean to examine proposals for sustaining the region’s tourism says, as far as he is aware, no definitive position has yet been taken on a controversial ticket tax on cruise passengers.

St. Kitts and Nevis Tourism Minister Dwyer Astaphan was reacting to statements made on Wednesday by the President of the Florida Caribbean Cruise Association (FCCA), Michelle Paige, who suggested that the matter has now been laid to rest. 

Participating in a Grenada talk show, the FCCA official further sought to refute suggestions made by the Secretary General of the Caribbean Tourism Organisation (CTO) Jean Holder that the ticket tax was very still very much alive, saying she had received a strong indication from Caribbean governments that they are no longer in support of the introduction of the levy.

“I have been told from every single destination that I work with, that they as far as they are concerned they are not in favour of it and if that is what they are telling me then that is what they should be telling their Secretary General,” the FCCA official told her radio audience. 


However, when contacted by CMC on Thursday, Astaphan, who serves as Chairman of the CTO Sustainable Tourism Fund Committee, which was set up last year at a meeting in Trinidad, said he was not aware that a conclusive regional position had been taken on the tax, which was being contemplated by governments as a means of raising revenue to support a sustainable tourism fund for the region. “If she (Michelle Paige) is right, it means that she knows something that I do not know, so I am not going to say she is wrong but we have not been advised that the Prime Ministers and other leaders in our region have come to a definitive position on the matter,” Astaphan said. 

In June 2003, at their meeting in New York, the CTO Ministers and Commissioners of Tourism agreed to recommend to their governments the creation of a Regional Sustainable Tourism Development Fund (STDF) by imposing a levy of US$ 20.00 on each ticket sold by the cruise lines for a cruise to a CTO member state. 

The purpose of the Fund was to provide resources for the enhancement of the regional marketing, human resource development, cultural, environmental and other product development tourism programmes of the region, articulated in a Regional Strategic Tourism Development Plan. 

Astaphan stressed that as far as he was aware the issue was still on the table and that, in any case, any regional position should have been enunciated though the Georgetown-based Caribbean Community (CARICOM) Secretariat or by a regional official. 

“in the normal course of events that’s how the region’s public would be advised on it,” he said. 

The Kittitian tourism minister also invited his colleagues to clear the air on the issue, complaining that all too often when “one public figure stands up and makes a statement that others would like to say, but are hesitant to do so, that person or his destination becomes a target. 

“As the CTO sub committee chairperson on this issue, I and my country St. Kitts have drawn all the fire while some people have run to the high grass or seen it convenient to duck as low as they can on the issue,” he told CMC. 

“That is not the way we must move forward as a region, we must always try to look at the big or the long picture and in the interest of our public and our entrepreneurial stakeholders the cruise line is an integral part of the Caribbean family,” he said. 

According to CTO statistics, Caribbean destinations received 15.5 million cruise passenger visits in 2002, four per cent more than in 2001, while it is estimated that cruise passengers spent an estimated US$ .6 billion in 2001, or nine per cent of the US $ 19.4 billion by all visitors to the region. 

Astaphan said the region would not want to do anything to hurt that business and must seek ways and means of ensuring that the cruise product is not only enhanced but sustained.