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Passenger tax hike `could hurt tourism'

they bring to Bermuda could contribute to the "decline'' of the Island's tourism industry, Opposition MPs warned yesterday.

Transport Minister Wayne Furbert told the House of Assembly that the 1995 Bermuda Air Terminal (Fees) Amendment Regulations would help cut the $8-million deficit that Bermudians inherited when they assumed responsibility for the Airport from the US Navy.

The fee, which follows the Senate's approval this week of a hike in Airport landing fees, will increase every year for the next three years, Mr. Furbert said.

He added that "48 cents is not unreasonable'', amounting to a "nominal'' $50 to $60 per trip for a carrier that flies in 150 passengers.

Even so, several Opposition MPs worried about the effect the fee might have on tourism in Bermuda, which already charged outgoing air travellers a $20 departure tax before hiking its landing fees this week.

"We have to be careful that we don't bite off our nose to spite our face,'' said Progressive Labour Party MP Rev. Trevor Woolridge . "Forty-eight cents may not sound like much, but it doesn't make it any easier to outfox the competition when you add it to an airline ticket that then increases some more.'' With regard to its impact on Bermuda's visitor drawing power, Rev. Woolridge said that he wanted to know who exactly would assume the cost of the fee -- the airline or the passenger? Though neither Mr. Furbert nor Tourism Minister David Dodwell could say with any certainty, both felt it was the carriers which would likely take on the fee, accepting it as a "modest and minor'' business expense.

"I think what we'll see,'' said Mr. Dodwell, "is that they (the fees) will be absorbed (by the airlines). I don't think that 48 cents or 96 cents will show up on the ticket.'' Mr. Furbert added: "We don't want to pass the burden (of lowering the Airport deficit) onto the taxpayer. We want to make sure that the Airport is paid for by its users.'' Although the Opposition supported the Government's rationale, MPs nonetheless cautioned the Transport Minister to avoid making a measure "that is designed to get us over a hump'' into a permanent solution.

"We on this side of the House understand Government's action in principle,'' said Rev. Woolridge, "but we must be extremely careful that this doesn't contribute to a decline in tourism, which would affect every man, woman and child in Bermuda.''