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Osborne ignores industry's plea on aviation tax

Published: 20/03/2013 - Filed under: News »

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Air Passenger Duty (APD) is to continue rising despite the travel industry’s pleas for chancellor George Osborne to scrap the aviation tax.

Osborne did not mention APD during today’s budget presentation in the House of Commons but documents released after the speech show that APD will rise “in line with inflation” from April 2014 on top of the already scheduled increase of 2 per cent from next month.

Groups such as the Fair Tax on Flying alliance and the UK's leading airlines have been calling for APD to scrapped but this has fallen on deaf ears with Osborne.

While the lowest rates of APD for journeys of less than 2,000 miles will remain flat at £13 per passenger for economy and £26 for all other classes of travel over the next two years, all of the other three bands will go up both in April 2013 and April 2014.

The CEOs of IAG, Virgin Atlantic, Easyjet and Ryanair responded to the news with the following statement:

"We are very disappointed that the Government’s tax on flying, already the highest in the world, will increase yet again this year and next. These rises in Air Passenger Duty show the emptiness of rhetoric on boosting exports to emerging economies and building the most competitive tax system in the world.

"Increasing this alarmingly uncompetitive tax on business, trade, and inbound tourism beggars belief when the evidence clearly suggests that abolition would deliver growth, create 60,000 jobs and pay for itself through higher receipts from other taxes."

Here are the full details of the APD rises:

Band A (0-2,000 miles from UK, includes Europe)

From April 1 2013
Economy: £13 (no change)
All other cabins: £26 (no change)

From April 1, 2014
Economy: £13 (no change)
All other cabins: £26 (no change)

Band B (2,001-4,000 miles, includes North America and Middle East)

From April 1 2013
Economy: £67 (up by £2 year-on-year)
All other cabins: £134 (up by £4)

From April 1, 2014
Economy: £69 (up by £2)
All other cabins: £138 (up by £4)

Band C (4,001-6,000 miles, ncludes South America, China and India)

From April 1 2013
Economy: £83 (up by £2)
All other cabins: £166 (up by £4)

From April 1 2014
Economy: £85 (up by £2)
All other cabins: £170 (up by £4)

Band D (over 6,000 miles, includes Australasia, Malaysia and Indonesia)

From April 1 2013
Economy: £94 (up by £2)
All other cabins: £188 (up by £4)

From April 1 2014
Economy: £97 (up by £3)
All other cabins: £194 (up by £4)

Report by Rob Gill

Is the UK government right to continue increasing the rate of APD? Have your say in our latest survey here.

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COMMENTS » 

MarcusUK - 20/03/2013 17:09

An even better reason to continue to put my business with KLM out of Amsterdam, along with a great choice of other carries.

It saves me £3-500 on each fare long haul, than leaving Ex LHR.

Many South East and Regional UK travellers, will continue to shun the charges and ignorance for business this government shows. It has no aviation strategy.

This is why the EU Airports gain, at the UK's expense.

WillieMaykit - 20/03/2013 17:32

They just don't get it. Simple maths - if you lower the tax, more people will fly in and out, which means more tax collected.

Same goes for the easing of visas for visitors from the BRIC nations.

PeterCoultas - 21/03/2013 19:22

if anyone thinks I'm going to pay the UK nearly 200 pounds in tax to fly on my regular australian trip next year they are mad...short haul to somewhere sensible for a break and then on....

MinhXuanTruong - 22/03/2013 14:37

The government has to have deaf ears about this issue to prove their point of no need to expand Heathrow. As in 5-10 years time, fewer and fewer people will use London airports anymore and there is no point for expansion. Problem solved(!) I don't think so!!!!

theworldtraveller - 24/03/2013 11:23

The government really know's how to slow a growth industry down and take less tax in total, just at a time they need more money.

Maybe they think having the highest ADP taxes in the world is something to be proud of ?

The UK Government now has a pretty impressive way of stopping both tourists and business people - high ADP, difficult/expensive visas and a congested LHR. Well done policy makers

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