Airport bosses call for APD rise to be shelved
31.10.11
The bosses of twelve airports have launched a scathing attack on a planned double-inflation increase in air passenger duty (APD), amid evidence that airlines are abandoning UK airports and choosing to run services from European rivals, the Scotsman reports. The airport heads, including BAA chief executive Colin Matthews, have today sent an open letter to Chancellor George Osborne, warning that the increase next year will further ‘stifle’ the aviation industry at a time when passenger numbers are flat-lining.
More routes will be cancelled to and from UK airports as airlines will choose to plough investment into cheaper European services, the airport bosses argue. The UK already has the highest rate of aviation tax in Europe. Many countries on the Continent, including Denmark, Norway, Malta and the Netherlands, have scrapped similar taxes over the damage caused to their economies.
Gordon Robertson, head of communications at Edinburgh Airport, warned the planned increase in APD, which is linked to the Retail Prices Index measure of inflation, would have a particularly detrimental effect in Scotland. He said: ‘We are all affected by APD – probably more so in Scotland than the south-east of England because we don’t have the transport links they do.’
While airlines are often reluctant to publicly state the reasons for cancelling routes, Mr Robertson said APD is often cited privately as a primary factor by major carriers. According to a survey of all of the UK airports published today, nine out of ten said high levels of taxation had already caused a reduction in passenger numbers over the past four years.
In the open letter, the 12 UK airport bosses say: ‘Airports are the lifeblood of every part of the UK. Yet the industry we serve is one of the highest taxed in the UK. The UK’s APD top rate is eight-and-a-half times higher than the next most expensive flight taxes levied by another country in the European Union.’
‘The business case for further rises in APD simply does not stack up. The impact will be to deter people from flying, or to displace flights to Europe, rather than to generate more tax revenue. It is inconceivable that this will not have a negative effect on the UK’s airports – and the hundreds of thousands of people who we employ. We urge the Government to re-think its plans.'
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