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Tourism not overly concerned about Air Passenger Duty

Despite the possibility of the U.K. Air Passenger Duty(APD)rising every year to 2016, a tourism executive doesn’t see the annual increases as a”significant threat,”to performance in the sector.

Director General in the Ministry of Tourism David Johnson told Guardian Business yesterday that the U.K. only represents 6 percent of the visitors that come to The Bahamas, and any eventual APD rises won’t have a drastic effect on arrival numbers in the future.

“Although we joined our partners in the Caribbean lobbying against the APD rises, it’s not a significant threat to us, because the U.K. market is not as large a market for us when compared to other countries in the region,”Johnson said.”Our largest traffic from the U.K. are passengers who travel first class and business class. We are concerned but we do believe that it won’t affect us as greatly as other countries.”

Signs are pointing to a rise in the APD over the next five years, with Commercial Secretary to the Treasury in the U.K. Lord Sassoon saying in a report that the rates are subject to inflation each year. The report also indicated that APD revenue will generate$4.8 billion by 2016.

The new APD rates–which came into effect last November–will make U.K. passengers traveling to the Caribbean pay up to$240 in taxes, a 33 percent increase from the previous prices.

The APD is divided into four different”bands”, which groups different countries and offers different rates in relation to their distance from the U.K. The Bahamas along with other regional countries initially lobbied with airline heads in September to be placed in the same band as the U.S., which has APD fees up to 25 percent lower than the Caribbean.

Calls are still being made to adjust the APD, with the most recent statements being made by Prime Minister of Jamaica Bruce Golding at the Caribbean Marketplace convention in Montego Bay. He stressed that the rise is”in conflict with established global rules of tourism.”

Johnson said he hasn’t heard any new developments on how the lobbying efforts have turned out and if the attempt to be placed in another band category turned out in their favor.

“It was a desire for the Caribbean to be placed in a different category but I’m unaware if those lobbying attempts were successful,”he said.”But even if it is or isn’t we are focused on improving our product regardless. The U.K. is a smaller piece of the pie.”

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