The International Air Transport Association (IATA), the global trade association that represents 290 carriers, has written to the Mia Mottley-led Government requesting that it rolls back the suite of taxes imposed on the travel and tourism industry.
Regional Vice President Peter Cerdá today said the Quebec, Canada-headquartered body was looking forward to meeting with the Barbados Labour Party administration to point out the dangers associated with the increased fees and charges.
"We did formally request to the Government of Barbados that they reconsider the tax put in place . . . .I would hope that we are able to have this debate and discussion in a sit-down with the Government, that we are able to demonstrate what taxation can do, what can happen when you begin to impose high fees to the industry," Cerdá told journalists today at a Caribbean Aviation Day conference at the Hilton Barbados Resort.
In her June 11 mini Budget, Mottley announced that as part of an Economic Recovery and Transformation Plan to haul the economy from the brink, tickets purchased for travel from October 1 this year would be subjected to a US$70 Airline Travel and Tourism Development fee for trips to extra-regional destinations and a US$35 levy for travel within the Caribbean.
It was the latest example of Caribbean governments using the airline industry as a cash cow, Cerdá charged, as he sent a chilling warning to Mottley that the tax would have consequences.
"We do believe when you impose these fees they have a negative effect. We have seen it in other parts of the world when these fee structures are put in place and are high, first passenger travel begins to diminish and airlines begin to exit the market. That is something we certainly don"™t want to happen in this part of the world," he said.
The IATA regional representative made reference to a study by the airline trade association "“ whose members are mostly the major carriers "“ which found that "each additional US$1 of ticket tax could lead to over 40,000 fewer passengers, US$20 million reduction in expenditures and 1,200 less job"…