Liat says targeted study needed for lowering taxes

Liat says targeted study needed for lowering taxes

Antigua Observer:- LIAT’s acting Chief Executive Officer (CEO) Julie-Reifer-Jones has stressed the need for less “general discussion” and instead, a more “specific” study that would encourage the airline’s shareholder governments to drop stifling taxes on air travel.

According to the acting CEO, the company is “exploring with the Caribbean Development Bank” the need to do a “technical study” to that effect.

She said the study must be targeted, from the onset, at informing the region’s finance ministers on the economics behind lowering taxes with the hopes of recouping revenue from increased air traffic.

“We are proposing to the governments that there needs to be a reduction in the taxes. There has never been a study that would guide the ministers … about how and the timing and the amount of the reduction that would be appropriate. A general discussion about taxes doesn’t allow a decision to be made,” she said.

The acting CEO said that the decision to lower the taxes was “not an easy one” admitting that they would contribute a number of government expenditures including the “funding [of] the airports” and “institutions that support aviation”.

In August, the Chairman of Pan Am World Airways Dominicana (PAWA Dominicana), Luis David Ramirez proposed that Caribbean governments co-operate through any of their regional multinational organisations to agree on a strategy aimed at reducing the taxes.

He said, “Governments have to understand that … they could collect even more money if [they] lower the taxes and increase the traffic – that’s the way we see it.”

Ramirez added, “In the last five years the total traffic of the Caribbean with the rest of the world has grown by 20 per cent. The traffic within the Caribbean has been reduced by 4 per cent.”

He pointed to the cost of intra-regional travel as part of the reason.

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