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By Henry Smith MP - 20th October 2011
Henry Smith MP says millions of people living in the south east should not have to pay even more tax to use their local airports.
UK air passenger duty (APD) is already higher than the European average by eight-and-a-half times. Only four other EU countries charge APD, five further members having recently having abandoned the tax because it cost their economies far more than it brought in revenue.
I congratulate the chancellor on freezing APD in the last budget, especially as it was significantly hiked up over the previous decade. My argument is that it should continued to be frozen next year and simplified, especially as we are also about to join the European Trading Scheme carbon offset system from the ne year, because hard working Britons deserve not to be priced out of a well-earned family holiday in time of household constraint and because UK economic growth as a trading nation depends on aviation.
However, there is one particular suggestion I would like to refute and that is the idea mooted by some that London and south east originating flights should pay an enhanced amount of APD compared with the rest of Great Britain.
I am very much opposed to this proposal because it would be unfair, unnecessary, economically misguided and environmentally dubious.
Unfair, because we already have one of the highest air duties in the world. Millions of people living in the south east should not have to pay even more tax to use their local airports.
Unnecessary, because the proposal seeks to address a problem that does not exist - with regional airport projected to significantly grow up to 2050.
It is economically misguided because, whilst proponents of the policy say it would re-balance the UK economy by moving key business routes to regional airports, it misunderstands the fundamental economics of long-haul business routes and ignores the fact that London's airport serve the whole British economy.
Indeed London is a global class city and with the south east a world class region, connecting and competing against the likes of southern California, the east coast cities of Japan and China, greater Frankfurt and Iles de France amongst others.
Finally the proposal is environmentally dubious because perversely there is a risk of increased carbon emissions if south east passengers then travel hundreds of miles to regional airport for cheaper flights. More indirect flights, for example London Heathrow to Manchester; Manchester to New York, would result in more movements and more take offs and landings.
Via APD, British aviation already more than offsets its carbon impact by about £100m, and rightly so, but additional tax burden may, I fear, ironically damage growth and so tax receipt, put added burdens on families and actually damage the environment.
Henry Smith has been Conservative MP for Crawley since 2010
Article Comments
I'm pleased the chancellor has recognised the damage that air passenger duty (APD) is doing to tourism in Northern Ireland and has reduced the level of APD tax on long haul flights there. But there are many other areas of the UK that are suffering similarly and the message is simple. The tax is counter productive and damaging to Britain's international competitiveness.
Simon Buck, Chief Executive of the British Air Transport Association (BATA)
20th Oct 2011 at 10:50 am
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