PM writes to UK Chancellor on APD

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PM writes to UK Chancellor on APD
UK Chancellor, Honourable George Osborne
UK Chancellor, Honourable George Osborne

Tuesday 10, July 2012 – Prime Minister, Honourable  Dr. Kenny D. Anthony has written to the UK Chancellor, Honourable George Osborne, raising the concerns of what he has described as the “deleterious effect that UK Air Passenger Duty continues to have on the economies of the Caribbean.”

The Prime Minister reminded the Chancellor that, “Caribbean leaders have raised this matter on several occasions, and have discussed the negative impact it is having, with Prime Minister Cameron, with William Hague the Foreign Secretary when he was in Grenada earlier this year for the UK Caribbean Forum, and with other British Ministers and the UK Parliament”.

According to Dr. Anthony, “The Caribbean understands the fiscal challenge faced by the UK in respect of raising revenue, but we do not believe that APD should be imposed unfairly, or at the expense of the Caribbean economy and our community in the UK.” The Prime Minister pointed out that, “The Caribbean is the most tourism dependent region of the world. The industry, as Prime Minister Cameron himself has acknowledged, is developmental and should be contributing to growth at a time of economic difficulty.

“Our data shows the negative effect that APD is having in this respect and hampers our ability to obtain the greatest benefit from our most valuable export industry. It also has a significant financial impact on the UK companies, large and small, with which we partner and for whom the Caribbean has been a major market. It is also hurting our sizeable Caribbean community living in the United Kingdom”.

Citing the case of Saint Lucia, Prime Minister Anthony explained that,  “Visitor arrivals from the UK declined every year for the past three years. In 2010 arrivals fell 19.4% below the 2008 level and 2011 registered 14.4% less compared to 2008. This decline in arrivals is exacerbated by a further reduction in on-island expenditure as the tax has had a negative impact on traveller’s budget, resulting in reduced economic benefit to the country. Indications are that tourism receipts associated with these declining numbers in the last three years have fallen on average more than 25% below the 2008 level”.

Prime Minister Anthony told the Chancellor that Caribbean Governments “remain committed to pursuing a positive dialogue with you and your Government about alternative, revenue neutral solutions that could address the discriminatory aspect of the current banding system by having the Caribbean and the USA placed in the same lower band”.

Prime Minister Anthony ended his letter by expressing the hope that this issue “can still be resolved amicably.”

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