Opinion: Enviro tax

POSTED: 11/13/12 3:00 PM

Aruba is leading the way in the Caribbean in several fields. Efforts in the area of renewable energy are one of the first things that come to mind, but now the country is also making headway with tax reform.

And there is a remarkable proposal in the pipeline: an environmental tax for tourists. In Philipsburg this will immediately pop up the dollar-signs in the eyes of our state number crunchers. Because what do we have: 1,5 million, and maybe even a bit more, cruise passengers that visit St. Maarten every year. How difficult could it be to squeeze some extra money out of these people?

The thing is of course that St. Maarten operates in a highly competitive cruise tourism market. As former Vromi Minister Theo Heyliger points out today, the cruise lines are making massive investments elsewhere in the Caribbean. That means that the cruise companies want to take their clients to those destinations. It does not mean that they will stop coming to St. Maarten, but it does mean that the cruise bosses are going to look with a critical eye at things like taxation.

It is therefore not so that Minister Tuitt can come up with an Aruba-style environmental tax on tourists without feeling any consequences. That is because tourists have alternatives and when the financial pressure gets too high, they will jump ship – figuratively speaking of course.

Heyliger, who is sitting on the sidelines as the leader of the UP without a seat in parliament to fall back on, has been playing the game with the cruise industry for well over fifteen years. In this context it is rather worrisome that, in his assessment, there are doubts whether the current Minister of Tourism and Economic Affairs Romeo Pantophlet understands his role in the government.

So maybe it is time to put some egos aside and to tap the wealth of experience Heyliger has gathered. How does St. Maarten hold up against other destinations in terms of taxation on cruise tourists? Is there any maneuvering space to increase these taxes without chasing visitors to other destinations?

Currently, if we are not mistaken, there is a so-called head tax of $5 for each arriving cruise passenger. How long this has been in place we do not know, but since everything is always getting more expensive, why not increase this levy? We don’t have to come specifically with an environmental tax on tourists; we could simply increase existing fees.

On the other hand, Aruba’s initiative sends a clear signal, because tourists will also often wonder what they are paying for. If an environmental tax is truly used for environmental purposes, visitors ought to experience a change for the better over time; that will make such a tax almost a soft sell.

For the time being, we figure that some market research is in order before introducing new taxes. But if we want to keep our tourist product up to date and in good shape, somebody will have to pay for it.

Ah, we almost forgot independent MP Frans Richardson’s by now almost ancient initiative to charge cruise tourists an extra $0.50. Guess what that was for: to fund local environmental groups. We wonder why we’re never hearing anything anymore about that initiative.

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