Antigua and Barbuda to make good on tax cut for intra-regional flights, CARICOM leaders also on board with region-wide travel tax reduction

LIAT could be a major beneficiary of the potential reduction on intra-regional travel taxes, as the carrier continues to face financial struggles
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By Orville Williams

[email protected]

The effort of Prime Minister, Gaston Browne, to ‘lead from the front’ with respect to the lowering of intra-regional travel taxes, could be realised in the very near future, with some hurdles having been successfully cleared.

Browne – who assumed the CARICOM chairmanship earlier this month – had proposed a 50% reduction on the taxes among member states, to satisfy Caribbean nationals desperate for more affordable travel between the islands, thereby encouraging more intra-regional travel.

He insisted that the time was right to experiment with the tax reduction, as the Covid-19 pandemic had ‘dried up’ much of the earnings within that sector, leaving the countries with ‘nothing to lose.’

Antigua and Barbuda was expected to get the ball rolling late last month, with a 50% reduction of the taxes on incoming flights. That plan was delayed, but Information Minister Melford Nicholas, said yesterday, things could kick into gear in short time.

“There was a matter of, I believe a statutory or regulatory matter that had to be dealt with, and the Attorney General assured the Prime Minister that that has already been completed. So, in so far as the airlines and [the International Air Transport Association] IATA are able to make the adjustments – in respect of the Antiguan tax component – that will come into [effect] in the coming days and weeks.”

As part of Browne’s push for the regional tax reduction, he warned that Antigua and Barbuda could not be the only country to make the decision and any success would depend on the cooperation of the regional governments.

Nicholas confirmed, on word from the PM, that the suggestion has been well-received and the necessary adjustments would be made across the CARICOM territories in the near future.

“The Prime Minister did indicate [on Wednesday] that he and his CARICOM colleagues would have discussed the matter and they are prepared to accept and follow Antigua’s lead in this regard. They are actually looking at a collaboration to be able to lower the cost of travel by the individual countries inspecting the regime that they have for charging taxes on tickets.

“Now, clearly, with a number of developments taking place across the region for a number of airports, many of these revenue streams have been hypothecated to support the investments. So, it may not be a uniformed regime…but clearly, they have taken on board the recommendation from the PM and I think we’re going to see – in the coming weeks and months – an incremental step toward some changes in that regime.”

Along with the thousands of Caribbean residents itching to travel between the islands for less, the management of LIAT will also be looking forward to these developments, as they could mean a big boost for the carrier that continues to face financial woes.

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