MP slams new aviation tax plans : Heathrow Airport News Stories

In an article in the Telegraph newspaper, Graham Brady, Conservative MP for Altrincham and Sale West and a member of the powerful House of Commons Treasury Select Committee, criticises Labour’s plans to replace the current per passenger air passenger duty (APD), with a new per plane based flight tax. There were hopes that this would encourage airlines to fly full, environmentally friendly planes, but Mr Brady raises concerns that this will not happen.

Mr Brady says that Gordon Brown's tax policies are disintegrating around him. Currently 'in a desperate scramble to buy off his rebels' over the abolition of the 10% tax rate, he predicts a 'repeat the whole exercise this autumn' when his proposals for a new tax on commercial flights called ‘aviation duty’ are announced.

He says: ' The idea is seductive: scrap an unpopular tax on air passengers and replace it with a new charge on every aircraft taking off from UK airports. On the face of it, this is a neat incentive for greener aviation - if airlines are taxed per flight rather than per passenger, surely they will stop flying planes with empty seats?'

'If only it were that simple. As the Treasury consultation closes today, ministers will have to assess the damage that their new tax will do to an £11 billion industry supporting 700,000 British jobs.'

He predicts that 'Britain's position at the centre of a global transport network will be hit, to the detriment of the City, and long-haul flights from our regional airports will be cut. What is worse, the new tax will achieve none of the environmental benefits intended - and may even cause emissions to increase.'

'Unfortunately, a ‘per plane’ duty will cause market distortions but no environmental benefit. Let's look first at air freight. This sector is vital for the transport of time-sensitive and perishable goods. Air freight underpins thousands of jobs - especially, but not exclusively, in the key election battlefield around East Midlands Airport.'

The highly competitive and price-sensitive freight sector is not affected by the existing passenger-related tax, but would be under the new proposals. If the hefty £16,000-plus currently paid by passengers on a typical long-haul Jumbo is to be recovered from a plane carrying freight, then those flights will be uneconomic.'

'They will simply divert to Holland and the goods will be transported to Britain by lorry and ferry. No reduction in aviation emissions, more lorries jamming our motorways and thousands of jobs exported to the Continent.'

'Even the simple expedient of exempting freight from the new arrangement doesn't work, because many goods are carried in the belly of passenger flights rather than on dedicated services.'

'What about passenger flights? Here, too, the realities of the aviation world get in the way. Huge numbers of passengers take connecting flights (more than half of those flying from Manchester to Heathrow, for example, are connecting to an onward flight).'

'The Government is planning to levy a charge every time a plane takes off from a UK airport and to band the tax according to distance flown. Under the new regime, if I want to fly from Manchester to Hong Kong I will have three choices: I can fly direct, paying a long-haul tax; I can fly from Manchester via Heathrow, incurring one short-haul charge and one long-haul charge; or my cheapest option will be to fly from Manchester to Schiphol or Paris, paying just a short-haul charge to Alistair Darling before hopping on a tax-free flight to Hong Kong.'

'Perhaps most galling of all, a tax proposal that was meant to clean up aircraft emissions is expected to make no distinction between older, dirtier planes and greener new ones. Instead of promoting cleaner direct flights, it will be an incentive for more people to take connecting services - with double the number of fuel-intensive take-offs and landings. It will increase emissions, cost jobs and put more foreign HGVs on our motorways.'

Mr Brady concludes that 'the plan is deeply flawed environmentally, legally and economically. If he goes ahead, aviation duty will become another tax albatross around [Mr Brown's] neck.'

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