All-Time High International Travel Deficit Highlights Business Case for Arrivals Duty Free in Canada



    Canada's airports say change in tax rules barring arrivals duty free
    would mean millions of dollars in additional Canadian revenue

    OTTAWA, March 2 /CNW Telbec/ - The Canadian Airports Council today said
recent Statistics Canada stats showing an all-time high international travel
deficit for Canada in 2006 serves to highlight how a change in tax rules
currently barring arrivals duty free in Canada could provide as much as
$50 million in additional revenue for Canadian airports and duty free
operators.
    As travellers may be more likely to purchase duty free goods on their
return home, the international travel deficit means that most of Canada's
international air travellers are Canadians buying duty free abroad instead of
in Canada. The CAC contends that this represents millions of dollars in
potential revenue for Canadian airports and duty free operations if the rules
can be changed to allow for arrivals duty free in Canada.
    "Airports have limited means by which they can generate revenue. In
addition to providing a valuable service for travellers from and to Canada,
duty free revenue is an important off-set to the aeronautical revenue airports
must charge to air carriers and their passengers," said Mr. Facette. "Arrivals
duty free represents a pain-free way for the government to allow airports and
duty free operators to repatriate sales and generate more money, while
creating jobs and federal tax revenue in the process."
    Arrivals duty free is the ability of an international traveller to
purchase duty free products on the ground at Canadian airports upon their
arrival from abroad, before seeing border service agents and officially
entering Canada. As a result of the ban on ADF, these same travellers will
have had the opportunity to buy duty free at their foreign airport of
departure as well as aboard their international flight, but not at Canadian
shops upon arrival.
    Airport duty free is a $174 million industry in Canada, providing the
federal government millions in tax revenue each year. However, most Canadian
travellers already buy their duty free abroad. A study on the matter indicated
that the introduction of arrivals duty free in Canada could mean as much as
$50 million a year in additional revenue for the sector, 340 new Canadian jobs
and $3.2 million in additional federal tax revenue.
    "Arrivals duty free has become an accepted and valued aspect of
Australia's welcome to tourists," former Australian Tourism and Customs
Minister John Brown has said of the introduction of arrivals duty free to
Australia, one of the 45 countries around the world with ADF today. "...The
availability of arrivals duty free has transformed the first experiences of
Australia's airports from a less sterile to a more vibrant and welcoming
experience."
    Meanwhile, according to data from the Frontier Duty Free Association,
carry on restrictions on liquids and gels imposed around the world since last
summer also have led to the more than $22 million decline in Canadian airport
duty free revenues in 2006. Allowing arrivals duty free would enable operators
to make up for lost sales from outbound passengers due to the liquid/gel ban.

    About the Canadian Airports Council

    The Canadian Airports Council (CAC) is the voice for Canada's airports.
Its 45 members encompass more than 150 airports, including all of the National
Airports System (NAS) airports and most significant municipal airports in
every province and territory. Together, CAC members handle virtually all of
the nation's air cargo and international passenger traffic and 95% of domestic
passenger traffic. They create well in excess of $30 billion in economic
activity in the communities they serve. And more than 150,000 jobs are
directly associated with CAC member airports, generating a payroll of more
than $8 billion annually.




For further information:

For further information: Daniel-Robert Gooch, Director of
Communications, Canadian Airports Council, (613) 560-9302 ext 16,
daniel.gooch@cacairports.ca


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