Treasury proposals for a tax on aircraft that will replace air passenger duty do not take account of fuel efficiencies on modern aircraft, risking the fury of low-cost giants EasyJet and Ryanair and criticism from environmental groups.
The proposals, released in a consultation document, suggest taxing aircraft according to their take-off weight and the distance of a route – with a band of charges for less than 3,000 miles, over 3,000 miles and so on.
There are no proposed tariffs, but the Treasury has said the tax must bring in more than £500 million a year more than the current £2 billion raised by air passenger duty (APD), which is applied to all passenger flights from the UK. However, the new tax will include executive jets and freight.
The tax would apply to all aircraft weighing more than 5.7 tonnes, about one-tenth the weight of the smallest commercial Airbus.
Airlines and other industry bodies have until April 24 to respond to the consultation, with final proposals expected in October. The tax is due to replace APD from November 2009.