Airport duty
After some initial enthusiasm, Government’s decision to increase duty at the LF Wade International Airport and to give retailers a break on payroll tax has become mired in confusion.The delay in the Airport duty rise until next month and the indecision about just who qualifies as a retail employee suggests that the decisions were taken quickly and without sufficient thought.That does not mean the decisions were wrong on their merits, only that they seem to have been made in a panic following the announcements of 150 job losses.That does not build confidence in the Government, which needs to be decisive, but also needs to do its homework.Still, most of the public seems to be broadly supportive of the payroll tax freeze for retailers, which will take some ten percent off labour costs for the retail sector and will also put money in the pockets of employees who are not among the high earners to start with.As has been pointed out, this will not necessarily lead to lower prices, but it may stop some retailers from going to the wall this year, thus preserving jobs.As has been stated previously, what is really needed is a reduction and rationalisation of Customs duty. That would lead to lower prices and added competitiveness at a stroke.In that context, the decision to restrict the duty free allowance to one household from one person, and the increase in duty payable at the Airport from 25 percent to 35 percent is looking increasingly hollow.It has been pointed out that the measure discriminates against large families. Thus the single adult traveller has an advantage over the family of four.The bigger problem lies with the duty hike, which it seems, will simply encourage people to order goods over the internet and have them couriered here or to buy overseas and ship the goods home.On that basis, the benefit to retailers may be negligible. As this newspaper has stated before, the better approach would be to lower duties generally.