Travel companies calls for elimination of APD

The travel industry is once again calling on the government to discontinue the Air Passenger Duty (APD), citing the difficult economic climate.

The amount of the APD was doubled in February of 2007, to £10 per passenger on short-haul economy fares and £40 for long-haul economy. The amounts for business-class and first-class passengers were raised to £20 on short-haul flights and £80 on long-haul. The government said the increase was related to environment issues, and it was severely criticised by many in the industry.

Dublin-based budget carrier Ryanair was one of the airlines that withheld APD payments to the government in the beginning, protesting what it called the government-imposed duty as the ‘Great Plane Robbery.’ The Irish carrier accused Gordon Brown of taking more than £1 billion in passenger money, falsely claiming that it was to be used for the improvement of environmental practices.

According to Civil Aviation Authority figures, the government’s revenue from the 243 million passengers taking flights from Britain last year was more than £4 billion. The total is actually higher than this amount, as it does not include the APD on business-class and first-class fares.

Last October, Alistair Darling, the Chancellor, announced that the APD would be replaced with a new tax in November of 2009, with the levy on a per-plane basis. The government’s belief is that this method would encourage the industry to engage in better environmental practices, but no additional details are yet available.

www.caa.co.uk