AIRPORT bosses have welcomed Chancellor George Osborne’s decision to shoot down calls for cheaper air taxes in Scotland.

Politicians north of the border had been pushing for the right to set their own levels of Air Passenger Duty (APD), a move that could have seen thousands more passengers heading for Edinburgh and Glasgow rather than Newcastle or Durham Tees Valley.

But managers were still far from happy with the announcement that fees for holidaymakers are set to rise by an inflation-busting 8% from next April, premium economy passengers are to be still taxed at a higher rate and charter services for businesses will now be hit by APD.

However, Graeme Mason, Newcastle International’s planning and corporate affairs director, said it could have been much worse.

“It’s very encouraging that the government is willing to further consider our Airport Congestion Tax plan that we submitted in response to how APD impacts on regional economies,” he said.

“And we were relieved by the government’s decision to keep the four-band tax system.

“It was a concern that in order to reduce the number of bands, the government would have to increase the rate for short haul flights.

“Given that regional airports predominantly provide access to short haul flights, this would have been bad news for the North East.

“We also welcome the decision to not devolve APD to Scotland. A lower rate of APD north of the border would encourage people to drive long distances for flights they would otherwise get from within the North East.

“This would lead to airlines relocating services to Edinburgh and Glasgow Airports, much to our detriment.

“This cross border flow would effectively be the start of the unraveling of APD, but as we would be in the front line, the damage would greatest here.”

Jim French, chairman and chief Executive of airline Flybe, which serves 28 destinations from Newcastle, also welcomed the decision to look at a possible regional system of taxation.

“We are delighted that the government has acknowledged that one of the key elements to regional economic revival is convenient, sustainable air transport services,” he said, “and we are particularly pleased with their commitment to examine the tax system to rebalance the UK economy across the regions.

“Flybe stands ready to assist the government in this very important area and will work with them to improve the regional connectivity that is so crucial to the wider economy.”

But four of the country’s biggest airlines were less impressed. In a statement the bosses of easyJet, Ryanair, Virgin Atlantic and British Airways, said the consultation on APD had been “a sham” and “a waste of taxpayers’ money”.

“We are left with a tax that has already cost 25,000 jobs, is doing increasing damage to the prospects for economic recovery, and sends a message to the world that Britain is a difficult and expensive place to do business,” they said.