AIRPORT chiefs in the North East have welcomed calls by four leading airlines to axe Air Passenger Duty (APD).
In a letter to chancellor George Osborne, bosses of Ryanair, easyJet, British Airways owner IAG and Virgin Atlantic said the tax, which has rocketed to as much as £170 on the most expensive flights today, is doing more economic harm than good.
The Journal has been campaigning against APD in its A Tax Too Far campaign because of its effects on regional airports. Yesterday Graeme Mason, planning and corporate affairs director at Newcastle International Airport said the fact four rivals with such differing philosophies about air travel could agree APD was such a bad idea showed the magnitude of the issue.
“Newcastle International Airport and The Journal have been highlighting this issue for some considerable time because of our concerns about the impact this tax will have on businesses, jobs, and people in our region,” he said.
“APD has a very damaging effect across the UK and this damage is particularly harshly felt in the regions. One way to help kick-start the economy would be to get rid of this regressive tax.”
In the letter, signed by IAG chief executive Willie Walsh, easyJet chief Carolyn McCall, Ryanair boss Michael O’Leary and Virgin Atlantic chief executive Steve Ridgway, the airlines pointed out to the chancellor that passenger numbers at UK airports had fallen back to pre 2004 levels. They challenged him to commission an independent report into the true economic effects of aviation tax on Britain.
“For hard-working families, APD is a tax too far for the privilege of taking a well-earned holiday. It is also a tax on tourism and a tax on business,” the letter said.
“Aviation doesn’t just drive exports – it is a major exporter in its own right with our airlines earning nearly £11bn of foreign revenues every year. Tourism is one of the UK’s most important earners and is worth £115bn to the UK economy.”
Next year will see the introduction of a new European emissions trading scheme that will further increase the burden on airlines and travellers.
“We take our responsibility to the environment very seriously and have taken steps to reduce our impact,” the letter said.
“We support an emissions trading scheme (ETS) in principle but a combination of both APD and ETS when it is introduced is unsustainable.”
The bosses said APD was doubled in 2007 and hiked again in each of the last two years, and that the UK had the highest aviation taxes in the world.
They pointed to the case of Holland, where an air tax scheme was abandoned after only a year as its harmful effects on the Dutch economy were nearly four times greater than the revenue it produced. Separately, a survey carried out by the airlines this week showed that 85% of those asked believe that aviation is important to the recovery of the UK economy and 77% believed APD was an unfair tax.
