Top executives at Easyjet, British Airways and Ryanair have called on the government to scrap Britain’s air passenger duty (APD), stating that its removal would boost GDP by 1.7 per cent and create 61,000 new jobs by 2020.
Chief executive of IAG Willie Walsh warned that the aviation tax, which is the world’s highest, was damaging the UK’s competitiveness and jobs.
“It’s a revenue raising tax designed to suppress air transport growth which is exactly what the economy does not need right now,” he said.
“Other countries that have scrapped their aviation taxes have seen an immediate boost to their GDP and tourism. Why saddle businesses and tourists with a tax that your European competitors do not have? APD is well past its sell-by date and must be scrapped.”
Since its introduction in 1995, passengers have paid more than £31 billion in air passenger duty, raising over £3 billion for the treasury in 2015.
Short haul passengers are currently charged £13 for every departing flight from the UK, which rises to £146 for long haul passengers. This fee is set to increase to up to £150 next April.
Both the Netherlands and Ireland removed the tax in 2009 and 2014 respectively, and have since reported strong growth.
“The introduction of a travel tax in Ireland in 2009 caused passenger numbers at Irish airports to collapse by almost 25 per cent, from 30 million to 23 million over four years, damaging tourism and inhibiting growth,” said Michael O’Leary, CEO of Ryanair.
“Thankfully, the Irish Government scrapped this tax in April 2014, which resulted in immediate traffic and route expansion at Irish airports, where Ryanair has grown strongly, and an influx of high spending tourists to Ireland, with passenger numbers reaching record levels (from 23 million in 2012 to 32 million in 2016).”
CEO of Easyjet Carolyn McCall said: “Removing APD, a tax on passengers that suffocates demand, would certainly stimulate economic growth and make travel easier and more affordable. There is so much evidence to support this in other countries.”
“It is not just visitors to the UK the tax affects – people travelling between London and Edinburgh for example are currently being hit twice as hard by paying £13 each way on the flights. So, removing APD could also strengthen the connections within the UK.”