British air passenger duty (APD), a tax imposed on British air travelers, could threaten ASEAN tourism, an association executive says.
Pacific Asia Travel Association (PATA) chief executive officer Martin J. Craigs said that British tourists would potentially choose to go elsewhere because they were already taxed up to £85 (US$130.4) each when they traveled anywhere in the Asia-Pacific region.
“If you do the arithmetic very roughly, for a family of four, with two children over two-years-old, that’s over $500 for a British family to leave their own country and holiday in Indonesia or anywhere else in Asia. That’s a very big disincentive for tourism,” Craigs said on Thursday at the ASEAN Tourism Forum in Manado, North Sulawesi.
The tax regulation would affect the outbound market, he said, as many British tourists would potentially choose to go to Dubai or Egypt in the Middle East instead of Asia.
“[British tourists] just want to go somewhere to get the sun. They like Asia because there's more attractions here. But if they are being taxed unreasonably, they will naturally choose to go somewhere else because holidays are very price-sensitive,” said Craigs.
“It has been a critical issue for our members,” he added.
APD is imposed through different rates of duty on British air travelers, and is based on geographical distance from London and the class of travel.
For example, British tourists traveling from London to Jakarta, approximately 12,000 kilometers apart, will have to pay £85 each in APD for the lowest class of travel, or £170 each in APD for premium seats, according to HM Revenue & Customs’ official website www.hmrc.gov.uk.
Many have criticized APD, which has been portrayed as an environment tax, as hurting tourism and the economies of developing countries.
Despite the fact that British air travelers are already the world's most heavily taxed, the British Chancellor's Autumn statement last November announced an almost 10-percent increase from the existing rate that will come into effect in April this year, the fourth hike in five years.