Air passenger tax ‘hinders efforts to see off recession’

Nov 4 2009 by William Green, The Journal

“Direct flight routes into the country and the region are important as they affect the strategic thinking of foreign companies. Companies need to know they can easily travel to a particular region before they choose to do business with it. The major North East airports have the capacity to deal with a lot more air traffic without the need for serious further investment.

“Developing more direct routes into the North East will boost the regional economy as well as better managing UK plc as a whole.”

And CBI Deputy Director General, John Cridland, also called for a tax rethink.

He said: “As the UK moves into recovery, aviation is critical to boosting the wider economy by increasing connectivity, and driving trade and investment.”

Last week the cost of air tickets was pushed up when the first of two increases in Air Passenger Duty (APD) airport departure tax took effect.

It is feared the rises – which are passed on to passengers through ticket prices – will lead to key routes being pulled from the region’s two airports, as well as acting as a barrier to new services being secured in the future.

Despite claiming the tax was set up to off-set the damage done by aircraft to the environment, several ministers have told The Journal the main benefit of the tax is to raise money for the Government.