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CRUISE SHIPS TAKE, BUT DON'T GIVE BACK

Although 65 percent of the cruise industry's profit comes from the Caribbean region, only 1 percent of the taxes the industry pays goes back to the region, according to Fortune magazine.
St. Lucia attempted to raise taxes on cruise passengers, writes Jeff Wise in Fortune's March 29 issue, and even banded together with 13 other Caribbean nations to charge a uniform $15-per-head tax, but the initiative failed. The cruise lines fought it by going one on one to each of the island countries and threatening to pull them from their schedules, according to John Bell, executive vice president of the Caribbean Hotel Association.
In recent weeks, the Finance committee of the Legislature has been wrestling with legislation that seeks to impose a $2.50 ocean carrier tax. Currently the cruise lines pay $7.50 to enter the port in St. Thomas. When they dock at West Indian Company Ltd. at Havensight, WICO gets $3.50 and $4 goes to the V.I. Port Authority. The V.I. Government gets nothing.
Many ships have been rerouted this summer, causing speculation that it was the industry's way of flexing its muscles. Carnival Cruise Line alone has canceled 10 calls — five in May, two in August and three in September.
Michele Paige of the Florida Caribbean Cruise Association was asked by reporters if there was any truth to the speculation. "I have no comment," was the answer.
Wise, in the Fortune article, asserts that it costs the government far more than it gets back to have the cruise ships in port, citing garbage, crowding, traffic, and, in the case of St. Thomas, services.
Advocates for the industry do not agree that cruise ships do more harm than good. Fortune quotes Paige as saying, "The ships bring a wealth of benefits, and destinations that don't have cruise visits are clamoring to get them. I think this is an example of the old syndrome: You don't appreciate what you have until you lose it."
Wise maintains that overnight guests spend 30 times as much as cruise ship passengers. The hope is, he explains, that next time the cruise ship passengers will become overnight guests.
According to recent statistics from Edward Thomas, president of WICO, cruise ship passengers and airplane arrivals contribute almost exactly the same amount to the coffers, with overnight guests spending only slightly more.
A Feb. 19 story in The New York Times by Douglas Frantz first revealed that cruise lines pay almost no income taxes, though they earn millions of dollars every year, are based in the United States, and 90 percent of their passengers are Americans.
As for their employees, Wise quotes Allen Chastanet, a former director of St. Lucia's tourist board, as saying that only 7 percent of cruise industry employees come from the Caribbean.
Because the ships are registered in foreign countries, said The Times, they are not required to observe minimum-wage laws, or many of the U.S. environmental and safety regulations.


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