Abstract
This paper investigated the impact of international stay-over arrivals on tax revenue for tourism-dependent Small Island Developing States (SIDS). To this end, we constructed a unique monthly panel data set of stay-over arrivals and tax revenue and its various components for the period 2002–2018 for Eastern Caribbean SIDS. A Bartik-type instrumental variables estimator exploiting differences in the exposure to and the extent of shocks in the origin markets was used to quantify the impact of stay-over arrivals on tax revenue and its different sources. Our results showed a large cumulative positive elasticity to tourism arrivals of 26.98% for total revenue, 26.86% for goods and services revenue, 23.62% for international trade and transactions revenue, 20.5% for income and profits revenue and 5.54% for property revenue. The findings demonstrate the region’s strong dependence on tourism for government income.
Original language | English |
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Journal | Current Issues in Tourism |
Early online date | 28 Apr 2023 |
DOIs | |
Publication status | E-pub ahead of print - 28 Apr 2023 |
Bibliographical note
Publisher Copyright:© 2023 Informa UK Limited, trading as Taylor & Francis Group.
Keywords
- air travel
- developing countries 1
- development
- instrumental variables estimator
- stay-over tourists
- Tax revenue
ASJC Scopus subject areas
- Geography, Planning and Development
- Tourism, Leisure and Hospitality Management