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APD increase comes into force

Air Passenger Duty, the tax levied on flights to and from the UK, has gone up by 8%, leading to renewed calls from the aviation industry for it to be scrapped.

The tax has been in place for more than five years, but has always been a divisive and controversial measure in the air travel industry. The latest APD hike sees passengers paying even more for both long-haul and short-haul flights in and out of the UK. A number of leading airlines have called for the tax to be scrapped, saying it is preventing the UK economy from growing.

“Yet again, the Treasury is pressing ahead with further rises without any analysis of their effect on the wider economy,” said a number of airlines, including easyJet and Virgin Atlantic, in a statement.

“In the absence of such a study, we must assume that the Treasury knows it cannot justify this job-destroying tax in overall economic terms. APD must be scrapped.” This is just the first in a number of APD increases planned by the government, which wants to raise the tax by a total of 48% by 2016.

The government has defended the tax, saying that it is the fairest possible system for both passengers and businesses. “We have made aviation tax fairer by bringing private business jets in for the first time,” Chloe Smith, Economic Secretary to the Treasury, told the BBC.

“We have been able to be clear about what will then happen to it this year – I think that does represent a fair deal for passengers and I think it does also represent a fair deal for businesses, who are today enjoying a historically low rate of corporation tax.” If you are planning on taking a holiday this year, you can expect to pay more as a result of the APD increases. But you can potentially save yourself money by taking out travel insurance, which will protect you from expensive medical bills should you need them.

Date Created: 04 April 2012

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