Departure tax up to $100 from next Wednesday

The Airport Service Charge paid by passengers departing by aircraft from St Vincent and the Grenadines will increase by 100 per cent from Wednesday, February 15.

Prime Minister Dr Ralph Gonsalves, while presenting the 2017 Budget on Monday, said the increase from EC$50 to EC$100 will yield approximately $5 million a year and is necessary to make up the shortfall in revenue at the Argyle International Airport (AIA).

He said the annual cost of operating the AIA is estimated at $20 million, some $13 million more than currently obtains at ET Joshua Airport.

Gonsalves said the expected revenue in the short to medium term from the Airport Service Charge (at the previous rate), landing and parking fees, rentals and other charges will cover approximately 50 per cent ($10 million) of the figure for the AIA.

Although the Central Government will provide a subvention of $5 million in 2017, it will be insufficient to fund the shortfall, hence the need for the additional $5 million from the increase in the Airport Service Tax.

Gonsalves said it is anticipated that as the traffic increases at the AIA, the extent of the subvention will decline

or cease.

“Even at EC $100, the Airport Service Charge on departing passengers is lower than that of the overwhelming number of CARICOM member states,” the Prime Minister said.