IAG: No Level Playing Field for APD
International Airlines Group (IAG) has warned MPs that Air Passenger Duty undermines Britain's position as a global trading nation post-Brexit and reduces the chance of its new longhaul low cost airline brand LEVEL flying from UK regions.
IAG is looking to expand LEVEL, which launched flights from Barcelona to the US and Latin America last year and will fly from Paris to the Caribbean and North America in July.
In a letter to MPs, IAG says abolishing APD would make it more likely that LEVEL could operate from Birmingham, Cardiff, Edinburgh and Manchester. However, it's not financially viable when LEVEL's fares start around £88 one way and longhaul economy APD is £78.
Willie Walsh, IAG chief executive, said: "British consumers are losing out because of APD. In Spain and France, LEVEL can offer lower fares than it can in the UK - and that goes for other longhaul low cost airlines too.
"MPs need to know that APD undermines our ability to introduce new low cost flights that would benefit their constituents. If APD was axed, IAG could open new routes and operate LEVEL from regional airports".
In the letter, IAG says it's foolhardy for a trading nation reliant on developing international connections post Brexit to tax aviation so harshly. In addition to £78 for economy passengers, passengers pay £156 in premium economy and business class. The latter will rise another 10 per cent to £172 next year.
Willie Walsh added: "By hiking APD in the last Budget, it's clear the Chancellor doesn't understand that Britain is losing out to countries that don't have draconian aviation taxes".