Big 4 airlines angry reaction to aviation tax report

Four of the UK’s biggest airlines have reacted angrily to a report on aviation taxes that shows that those levied by Britain are among the highest in the world.

The report, which was carried out by the World Economic Forum, showed that Britain ranked 139 out of 140 on the taxation list, putting it into the same strata as Chad and Senegal.

The UK’s major airlines have long been campaigning against the level of Air Passenger Duty (APD) in the country, and this comparative report has only fuelled their anger. Willie Walsh, CEO of the IAG, Carolyn McCall, CEO of Easyjet, Michael O’Leary, CEO of Ryanair and Craig Kreeger, CEO of Virgin Atlantic have issued a joint statement, saying, ‘It’s hard to find another comparable table on a key measure of international competitiveness which shows the UK to be trailing the rest of the world. This isn’t just a blow to our national pride but demonstrates the unjustified level of Air Passenger Duty and, following the recent PWC report, provides further evidence that the Chancellor must take action in the Budget on this destructive tax.

‘The PWC report highlighted the critical role that aviation plays as an engine of economic growth for both international commerce and tourism. It confirms that abolishing APD would provide the UK economy with a GDP boost worth at least £16 billion in the first three years, generating enough extra revenue from other taxes to give the Treasury a net gain and resulting in almost 60,000 new jobs in the UK.

‘We call upon the Chancellor to use the forthcoming Budget to remove APD to stimulate economic growth and create jobs.’

Northern Ireland Cancels Air Passenger Duty on Long Distance Flights

Airline passengers in Northern Ireland flying long distance from Belfast Airport will be spared having to pay Air Passenger Duty (APD) next year.

The Northern Ireland Assembly has recently voted to remove APD on long-haul flights from January 2013, while the charges will still be levied on short distance flights.

From next year, passengers taking direct long-haul flights from Belfast airport will no longer have to pay, following the partial devolution of powers to the Northern Ireland Executive.

Last year, the Department for Transport in the UK lowered the APD rates on long-haul flights from Northern Ireland to the same level as short-haul flights, and the new move is expected to encourage international tourists to visit the country.

The rate cut is also in response to competition from the Republic of Ireland, where APD for short distance flights departing from Dublin Airport is currently just €3.

The Association of British Travel Agents (ABTA), a UK-based travel agents association, has earlier called for the international community to extend support against the increase in the UK’s Air Passenger Duty.

The UK government is currently charging APD for passengers flying out of the UK on an aircraft that has an authorised take-off weight of more than ten tonnes, or twenty seats for passengers. Passengers must pay the tax twice on a return journey, adding around an additional £26 to a return fare.

APD was introduced in 1994, and the annual revenue generated by the tax has increased by 250 percent since its introduction. In 2012, the tax will be providing £2.6bn to the Treasury. In a recent survey conducted by ABTA, forty percent of UK travellers said that high air taxes have put them off flying, an opinion that is expected to negatively affect leisure air travel in UK.

Survey confirms Air Passenger Duty anger

The growing antagonism of passengers towards Air Passenger Duty (APD) has been highlighted by the findings of a recent survey.

The duty, which is levied on all flights from a United Kingdom airport on any aircraft that has an authorised take-off weight of more than ten tonnes, or more than twenty seats for passengers, has been the subject of dramatic increases in recent times, and has subsequently drawn much criticism.

The new survey, which was carried out by ComRes for UK airports, canvassed the opinions of 2,000 people. An overwhelming 82 percent of those questioned stated that they wanted to see changes to the duty. Meanwhile, a separate survey carried out by the Airport Operators Association (AOA), which involved the opinions of 500 business leaders, found that 73 percent of them believe that in the interest of growth and job creation, the British aviation industry should be supported by the government.

At AOA’s conference, which opened in London today, the organisation is to launch its aviation policy, ‘Integrated Framework for UK Aviation: Connecting the Economy for Jobs and Growth’. The policy, aimed at the government, sets out 25 recommendations to boost the aviation industry, and ultimately the economy of the whole country.

Ed Anderson, the chairman of the AOA, said, ‘Sadly, the government’s draft aviation policy framework is not an integrated aviation policy which will help boost our airports or the UK economy. We think this is a major error, and it is why we are launching our own policy document to hopefully focus the minds. The government has to realise that the aviation industry plays a major role in resolving the ongoing problem of growing the economy – and so we have produced a bold and specifically cross-departmental integrated aviation policy to should what is possible. Our ‘Integrated Framework’ unashamedly promotes the case for aviation and urges the government to do likewise, to ensure our sector can prosper for the ultimate benefit of the whole economy.’

Flybe Gains Passenger Support In War On Air Passenger Duty Tax

Flybe, a UK-based airline company, has gained support from British passengers in its battle with the UK government over Air Passenger Duty (APD) tax.

The government will charge APD to travellers flying out of the UK in aircraft that have an authorised take-off weight of more than ten tonnes, or more than twenty seats for passengers. The passengers have to pay the tax twice when they undertake a return journey, which adds around £26 to a return fare.

The airline has reported that thousands of passengers have supported its Fair Tax on Flying campaign, being held in a collaboration with 30 airlines, airports and tour operators.

Niall Duffy, the airline head of public relations and public affairs, said, ‘We would like to thank the thousands of our passengers who have supported the Fair Deal on Tax campaign to date. Air Passenger Duty is a barrier to economic growth.

Flybe supports any reform of APD that deals with the inherent unfairness that means UK domestic passengers pay the tax on both legs of their journey, while those flying abroad pay just once because APD is a departure tax from a UK airport. So, for example, a return passenger travelling between Exeter and Manchester (188 miles) pays double the tax that someone flying between Glasgow and Dalaman in Eastern Turkey does (4,086 miles). That is not just inequitable – it is scandalous.

Flybe still believes that this ‘double hit’ must be addressed in order to safeguard UK domestic aviation and UK regional economic competitiveness.’

Time to scrap Air Passenger Tax

The world’s leading private sector of travel and tourism businesses has called for the UK Air Passenger Duty (APD) to be abolished ahead of the introduction of the European Emissions Trading Scheme in 2012.

Championed by the World Travel&Tourism Council (WTTC), the call follows the British government unveiling its budget (March 23, 2011). The budget has abandoned an industry-pacifying consultation on changes to the much-derided tax and delayed yet another rise in the fee, which would inevitably have been passed on to travelers.

APD has always been a blunt instrument and a bad tax. Whether in its current per-passenger form or as a per-plane version, it is bad for the consumer and bad for the international competitiveness of UK plc. The advent of the European Emissions Trading Scheme is an ideal opportunity for government to scrap it entirely,” said David Scowsill, President&CEO of WTTC. “It is time to admit that APD has failed to offset any environmental impact from people’s travel.”

The European Emissions Trading Scheme is much fairer and more effective in incentivising the use of cleaner, “greener” transport, while APD simply raises money for Treasury coffers with no evidence that it offsets the environmental cost of travel. By not scrapping APD, claims WTTC, the government will force British holidaymakers and business travelers to “fly once, but pay twice” when EU-ETS comes into force. It will hit people’s wallets and their ability to take a break at a time when government austerity measures are already impacting their lives.

Taxation policies such as APD could also threaten the UK’s status as a tourism destination and its international competitiveness. Travel and tourism is worth £105 billion to UK plc, 7% of GDP, and employs some 2.4 million people. Its contribution to GDP will increase by 3.7% a year and bring with it 512,000 new jobs to the UK over the next decade. However, compared to the rest of the world, the country’s growth ranks a lowly 127th out of 181 countries.

Despite economic growth facing many challenges, the travel and tourism industry is still expected to be one of the world’s fastest-growing sectors. But it must have clear support with governments investing in far smarter policies if its full potential to create jobs, increase exports, and stimulate investment is to be realized,” concluded David.

If the chancellor really seeks a ‘budget for growth,’ then it’s time to turn to tourism,” David stated.

The World Travel&Tourism Council represents the chairs and chief executives of multinational brands from aviation, hospitality, tour operator, and travel agent sectors. It works with governments around the world to encourage policies to help travel and tourism thrive.