WHEN, 18 months ago, the European Commission in Brussels told the British Government that charging Air Passenger Duty on just one leg of a return journey within the UK was contrary to European single market legislation, and therefore illegal, there was never any realistic chance that chancellor Gordon Brown would fight the ruling all the way to the European Court.
It was at that point that the F-Air Passenger Duty for all campaign – the alliance of Britain’s major aviation and tourism organisations – set about persuading the Treasury, with the support of Travel Weekly, that any additional duty should be handed back to the industry in the form of a lower rate of APD for both legs of a return journey. It’s what politicians like to call tax neutral.
In Gordon Brown’s pre-budget statement last week he confirmed that, at an unspecified date in the future, APD would be charged on both legs of a return domestic flight, but that he would, effectively, be handing back the additional tax to the industry in the form of a reduced rate for lower cost flights.
While there will be detailed discussion with the Treasury on the definition of lower cost flights, the chancellor’s statement is an implicit acknowledgement that the current taxation on flights is causing the industry real concern and is higher than justified.
Naturally, the F-Air Passenger Duty for all campaign does not welcome additional taxes on the industry or its customers.
However, we can claim success in persuading the chancellor that Britain’s tourism industry is vitally important to the health and prosperity of this country, and that any additional tax burden runs the risk of killing the golden goose.
It is also clear that Britain’s tourism industry, working in harmony, and with a focused agenda, can persuade the Government that unsustainable taxation levels and restrictive legislation cause enormous damage to one of our most important industries.
At the last Labour conference members of the travel industry spent considerable time lobbying MPs to ensure the message got across.
The F-Air Passenger Duty for all campaign has scored a small victory for common sense.
One of the key objectives of the campaign is to stabilise APD for as long as is possible.
That work is far from over and during the next few months and beyond we will be working hard to persuade the chancellor that he should look elsewhere when he next needs to raise additional revenue.