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Air Passenger Duty: is the UK government mad or stupid?

A new report by the World Economic Forum suggests that the UK’s ever-increasing Air Passenger Duty (APD), that taxes air travel into or out of the UK, is costing the economy – in lost tourist revenue and reduced outbound travel – far more than the amount it chisels out of it’s sitting-duck victims. Adding to the UK’s hideously expensive costs both for tourist visas and internal travel, the APD brings the country comfortably into the world’s list of least welcoming centres for international travel.

Reacting to the World Economic Forum’s report, Willie Walsh, chief executive of British Airways’ parent company, IAG; Carolyn McCall, chief executive easyJet; Michael O’Leary, chief executive Ryanair and Craig Kreeger, chief executive of Virgin Atlantic jointly said:

“The WEF report shows that Britain has the highest aviation taxes and charges in the world, ranked 139th out of 140 and rubbing shoulders with countries like Chad, Senegal and the Dominican Republic.

“It’s hard to find another comparable table on a key measure of international competitiveness which shows the UK to be trailing the rest of the world. This isn’t just a blow to our national pride but demonstrates the unjustified level of Air Passenger Duty and, following the recent PWC report, provides further evidence that the Chancellor must take action in the Budget on this destructive tax.

“The PWC report highlighted the critical role that aviation plays as an engine of economic growth for both international commerce and tourism. It confirms that abolishing APD would provide the UK economy with a GDP boost worth at least £16 billion in the first three years, generating enough extra revenue from other taxes to give the Treasury a net gain and resulting in almost 60,000 new jobs in the UK.

“We call upon the Chancellor to use the forthcoming Budget to remove APD to stimulate economic growth and create jobs.”

It’s not just inbound tourism that the tax is damaging. The indentured labour of the UK’s working and middle classes are already forced into endless hours of servitude in a miserably damp climate. For half the year there’s little sign even of daylight. Air Passenger Duty, along with reduced wages and a collapsing international currency, mean they can no longer escape for the traditional, if pathetically brief, annual exposure to sunlight. This adds to the problems of an outbound travel industry on its knees and further slows an already miserable economy.

At first sight it would seem Air Passenger Duty, instituted under the Labour government but with an escalator enthusiastically endorsed by the Conservatives, was actually mad. But this would imply a sort of deranged intelligence – and there’s little signs of that in the pampered ranks of the UK’s dearly beloved leaders.

Who rarely struggle to pay for their own flights.

Stupid is far more likely.

See the report in full here.

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