Barbados to implement money back scheme to counter rising APD Tax

In an effort to entice more UK holidaymakers to book holidays in Barbados, the island's tourism officials have announced that they will implement a "money back" scheme to enable Britons to recoup the cost of the Air Passenger Duty (APD) Tax. Visitors booking a stay at a participating hotel for a minimum of two weeks will receive a credit voucher equivalent to the sum of money paid in the APD Tax.

The UK's Air Passenger Duty (APD) has proved to be a major source of contention for the Caribbean region's tourism industry. Officials and key industry stakeholders from across the region have maintained that the steep tax has negatively impacted on the number of UK holidaymakers visiting the Caribbean in recent years.

The government of Barbados has taken matters into its own hands announcing its decision to implement a "money back" initiative that will allow travellers to recoup the cost of the APD Tax that is built into the cost of their flight to Barbados from the UK. Under the revolutionary initiative, those visitors who book a stay at a participating hotel in Barbados for a minimum of two weeks will receive a credit voucher equivalent to the amount paid towards the APD.

The decision has been welcomed by the Barbados Hotel and Tourism Association as several local hoteliers have raised concerns over the impact the APD has had on business.

The APD Tax has risen to as much as £83 per person for those flying to Barbados in economy class and much higher for anyone hoping to travel in business or first class. Many say that it is no coincidence that along with the steady increase in the APD, arrivals from the UK- one of Barbados' key source markets, has dropped by approximately 10 per cent from 2012 figures.

Much of the controversy over the tax has stemmed from the current methods used to calculate the APD as it is said to work to the disadvantage of the Caribbean region. The APD calculated according to the distance between UK capital and the capital city of the destination, is inherently biased towards the United States.

The end result is a higher tax for Caribbean holidays than for holidays to US destinations located west of the East Coast cities, despite the fact that they are further away. As a result budget conscious travellers are likely to favor destinations like Hawaii over Caribbean destination like Barbados, Jamaica, St Lucia and Trinidad and Tobago.

There are reports that Caribbean High Commissioners in the UK will soon renew their lobbying efforts for a removal of the APD or at the very least a review of the current method for calculating the tax. However, the outlook remains grim for the Caribbean region as despite widespread pressure in the past from Caribbean government officials, airlines and passengers, the UK government has so far stood its ground on the issue.