3-May-2010 12:08 PM

Liberal Democrat Party would replace APD with 'per plane' tax

UK’s Liberal Democrat Party confirmed plans to convert the UK Government’s Air Passenger Duty (APD) into a "per plane" tax if elected (telegraph.co.uk, 30-Apr-2010). The party aims to raise more than GBP5 billion p/a from the tax, up from the GBP2 billion p/a under the Labour Party’s plans. The party stated the tax would mean that the further passengers fly, the more they will pay. It also plans to impose a higher tax on domestic flights to raise an additional GBP255 million p/a. The party stated the tax is justified as there are “less polluting” forms of travel readily available. The Airport Operators Association responded stating the move would affect British travellers and companies. British Airways stated air travel from the UK was already the most heavily taxed in the world. The British Air Transport Association stated that the party does not plan to use the revenue earned from the taxes for environmental purposes.

Liberal Democratic Party: “Air travel is not taxed enough. The current charges on air travel do not reflect its environmental and economic cost. It has become cheaper to fly in real terms in recent years, and we need to make the polluters pay,” Spokesperson. Source: telegraph.co.uk, 30-Apr-2010.

Airport Operators Association: “A 'per plane' tax would hurt regional airports and result in the range of destinations they offer decreasing. It would reduce the UK's global connections and hurt the air freight industry. The impact on jobs and the lost investment and lost tax revenues could make this a very costly policy,” David Bishop, Policy Manager. Source: telegraph.co.uk, 30-Apr-2010.

British Airways: “Increased taxation on the UK aviation industry will create a financial incentive for customers to fly via continental hubs rather than direct from, or transferring through, UK airports, which could actually lead to higher emissions as well as financially disadvantaging the UK travel industry,” Spokesperson. Source: telegraph.co.uk, 30-Apr-2010.

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