Outrigger Hotels and Resorts

Published on Thursday, March 17, 2016

Chancellor berated for failing to act on APD


IAG chief executive Willie Walsh was one of the first in the travel industry to criticise the Chancellor for failing to address Air Passenger Duty in yesterday's Budget.

He said George Osborne had missed the opportunity to get rid of 'this out of control tax'.

In April, APD will increase by 2.8% versus April 2015. In April 2017, APD will go up from £146 to £150. 

"Another stealth tax has been sneaked into the Budget. Air Passenger Duty, which fleeces holidaymakers and businesses, will go up next month by almost ten times inflation," said Walsh.

"It is costing the UK jobs and growth as no other European nation taxes visitors leaving the country up to £146.

"APD is on the way out in Scotland. It's time to scrap it across the UK."

Earlier this week, the Scottish Government launched a consultation on its proposals to halve APD on flights from Scottish airports between 2018 and 2021, with a view to fully abolishing the charge beyond that date.

A spokesman for ABTA said: "While short-haul APD will be frozen, ABTA is disappointed that the Chancellor used today's Budget to raise Band B APD by inflation, rather than to address the uncompetitive level of APD overall. 

"With devolution of the tax to Scotland gathering pace, and the Scottish Government committed to a forward-looking 50% APD cut, we need urgent action from the Treasury to bring APD down across the whole of the country to ensure a competitive, fair rate."

However, ABTA said it welcomed the reduction to business tax bills for many small travel businesses as well as further reductions in corporation tax, and the freezing of fuel duty for a sixth consecutive year.

Catherine McKinnell, the MP for Newcastle North, also criticised the Chancellor for failing to mention APD during the budget.

She told ITV: "After many months of prevaricating, George Osborne had the perfect opportunity at today's Budget to set out how he will ensure that Newcastle Airport is not damaged by APD devolution to Scotland.

"Regional airports like Newcastle need to know now how they will be protected, and any talk of a Northern Powerhouse is completely undermined by the Chancellor's continued failure on this issue."

In the Budget, the Chancellor pledged that £80m would be spent on Crossrail 2 as he announced a new railway to run north-south across London. The National Infrastructure Commission has said it should open in 2033.

He also said £60m would be handed to High Speed 3 which is intended to link Leeds and Manchester and cut journey times as well as £75m to explore options for an 18-mile Trans-Pennine road tunnel between Sheffield and Manchester.

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