Aviation industry slam budget APD change
13.03.08
The aviation industry has slammed plans by the Government to increase the ‘green’ airlines levy by 10% in the budget. Labour are planning to replace the existing per passenger based air passenger duty (APD) with a single per plane tax in November 2009. And Chancellor Alistair Darling said yesterday in his budget speech that the amount raised by this would increase by 10% in the second year of the new per flight tax regime to match growth in the aviation industry.
However, Jim Callaghan, head of regulatory affairs at Ryanair said: ‘We will oppose this tax rise. It is not an environmental tax because it's not being spent on the environment, it's just another rip-off.' A spokesman for Virgin Atlantic added that the £3 billion raised by ADP each year was ‘more than enough to cover the cost of emissions of the UK aviation industry’.
Guild of Travel Management Companies chief executive, Philip Carlisle, said the move was 'another short-sighted tax grab by government,' adding: 'The Treasury's press notice supporting the Budget Statement explicitly states that the purpose of this tax increase is to raise money to pay for public services.'
'We acknowledge that aviation should bear the cost of its emissions but the revenue raised should fund either environmental projects or be used to develop much-needed transport infrastructure. Aviation should not be used as a means for the Chancellor to raise general revenue to help him balance the books.'
Cheapflights general manager UK, Francesca Ecsery, agreed that the money raised by this 'green' tax should not go straight into Government coffers. She said: 'We support moves to reduce aviation’s already small global emissions footprint 2% globally set out in the Sustainable Aviation Report. However, we believe the additional tax revenues should be applied to achieving the stringent 50% noise, CO2 and NO2 reduction targets set out in the report by and for the aviation industry for 2020.'
Neil Pakey, Chairman of the Airport Operators Association (and Liverpool Airport boss) said: ‘The industry has already realised £11 billion in taxation since the inception of the APD. This rise risks damaging the UK’s economic competitiveness, and does little to encourage a reduction in aviation emissions.'
'The irony is that so far none of this 'tax' has been reinvested back into environmental improvements in the industry. We need to move towards a genuinely ‘green’ aviation duty, which would provide incentives for the aviation industry to invest further in methods of carbon reduction.’
The public consultation on the design of the new per plane duty opened on January 31 and will close on April 24.
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