Abta welcomes reform of APD

Abta has welcomed the reform of Air Passenger Duty by the Conservative-Liberal Democrat coalition but called for the tax levels not to be “punitive”.

The coalition announced its intention today to replace APD with a per plane, rather than per passenger, tax as part of its initial agreement.

Abta chief executive Mark Tanzer said: “We have always stated that the travel industry should be taxed fairly and that a system more closely aligned to the efficiency of aircraft and distance travelled is the fairest way to achieve this.

“However the amount of this taxation must not be set at a punitive level and when the European Union’s Emissions Trading Scheme comes into force in 2012 it should be scrapped.”

However Tanzer said he did not support the coalition’s decision not to expand Heathrow, Gatwick or Stansted airports.

“Banning any airport expansion will severely damage UK PLC without significant environmental benefits, as air traffic will simply migrate to our competitors on the continent,” he said.

Tui Travel chief executive Peter Long said he was “delighted” with the move. He said: “TUI Travel has long argued for this change which will reward airlines like Thomson Airways that operate with the highest load factors in the industry, and will incentivise carbon efficient behaviour.

“We intend to work closely with the new government and the Department of Transport on a number of ongoing issues, in addition to the replacement of APD, including financial support for the industry following the blanket closure of airspace and reform of the ATOL regulations providing financial protection for customers.”

Meanwhile, airlines have welcomed the reform of APD but called for the tax to be “greener and fairer”.

British Airways said there was no guarantee that the new scheme would be used to fund environmental or infrastructure benefits.

A statement said: “Air travel from the UK is already the most heavily taxed in the world. We believe that aviation’s impact on climate change is most effectively addressed by the inclusion of airlines within the EU emissions trading scheme which will happen from 2012.  

“The existing APD is not used to fund environmental or infrastructure benefits, and there is no guarantee that a flight-based tax would.”  

EasyJet chief executive Andy Harrison welcomed the end of the current scheme. He said: “A tax that forces families to subsidise private jets, cargo planes and 20 million foreign transfer passengers per year is way past its sell-by date.

“From an environmental perspective APD gives a perverse incentive – full planes pay the highest tax whilst empty ones pay no tax at all. We need to make air tax greener and fairer now. It should be reformed from a poll tax into a flight tax that taxes emissions, not families.”


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