The air passenger duty hikes, which came into force at the end of last year, have resulted in a significant fall in the number of Britons travelling to the Caribbean and India.
According to a leading travel agent, the new prices have led to 17 percent reduction in the number of holidays booked to Band-C countries, classed as between 4,000 and 6,000 miles from the UK, including India, Thailand and the Caribbean.
The analysis by Co-operative Travel of over 30,000 holidays it sold showed a 17 percent reduction in Band C holidays since November 2010 year-on-year. India was hardest hit, down 34 percent, whilst the Caribbean was 20 percent lower.
The Co-Operative group blamed the sales slump on the new APD levies rather than a tough economic market.
Last November duty to Band C destinations was raised from £50 to £75 per person. This means a family of four flying to the Caribbean now has to pay £300 in duty compared with the previous rate of £200, and £160 the year before.
Mike Greenacre, managing director of The Co-operative Travel, said: ”This is a very worrying trend that impacts not only on holidaymakers but the many people employed in the travel industry that sell Caribbean and Asian holidays – both in the UK and abroad.
“Transport Minister Theresa Villiers confirmed last week that the Government is examining the impact of taxation on aviation with a view to an announcement in March: let’s hope that the conclusions will have a positive impact on the tourism industry.
(Jamaica’s Minister of Tourism, the Honourable Edmund Bartlett, is lobbying hard for a review of APD)
Jamaica “hopeful” of APD revision
Earlier this week’s Jamaica’s influential Minister of Tourism, the Honourable Edmund Bartlett, said his nation was “remaining hopeful” that the British government would amend APD at the next budget in March.
Speaking in London about the issues related to APD, Minister Bartlett said that he welcomed comments made recently by the Economic Secretary to the Treasury, Justine Greening MP.
At a recent adjournment debate on APD and the Caribbean, Ms Greening said that the UK government recognised the importance of the “strong ties” that exist between the UK and the Caribbean countries.
Since the announcement of the revised APD system in 2008, Caribbean governments, the Caribbean Tourism Organisation and the UK-Caribbean Diaspora have been campaigning against the discriminatory nature of the four band system.
The Caribbean is one of the most tourism dependent regions in the world, and has been arguing that the tax will severely impact upon tourism arrivals from the UK to the Caribbean, as well as being particularly damaging to UK voters in the Caribbean community.
It has put forward alternative proposals highlighting how a simpler two band system could be revenue neutral for the UK Treasury while encouraging more environmentally friendly forms of travel where there are alternatives to flying.
He said: “The UK government said that it will consult on any major changes to APD. It is my hope that on 23 March a change to the current structure is proposed and that all interested parties will then have the opportunity to consult on the proposed changes. It would be great to see a revised system that affords fair treatment to all countries implemented as soon as possible”.