Group of 10 regional airports want a congestion tax on flights from Heathrow and Gatwick

Financial Times article in full is at

Levy tax on Heathrow and Gatwick trips, airports urge

By Chris Tighe

16.6.2011 (Financial Times)
A congestion tax should be charged on passengers and airlines flying out of Heathrow
and Gatwick, a group of UK regional airports has told the government.

The 10 airports – including Manchester, Newcastle, Birmingham and Bristol – say
air passenger duty has a damaging and disproportionate impact on the regions.

Responding to the government’s APD consultation, which closes on Friday, the
airports urged the introduction of a congestion-related tax – a move that would
affect Heathrow and Gatwick, Britain’s two busiest airports.

Such a move, proponents argue, would help rebalance the economy by providing
an economic incentive for airlines and passengers to make better use of capacity

They also warn that regional airports have been hardest hit by the economic downturn
and have a far lower percentage of business travellers, inbound tourists or wealthy
passengers with a high propensity to fly. “Without decisive action, the gap between
the largest London airports and those in the regions will go on increasing,” they
The airports calling for a congestion-based surcharge say legal advice suggests
differential taxes can be compatible with European Union state aid rules.
A congestion tax could, they say, be based on the percentage of flying slots
used, measured by ACL, the independent UK slot co-ordination authority. Their
proposal would mean ditching APD and possibly introducing a lower-rate, generally
imposed tax, supplemented by a congestion tax.

Impose congestion charge on Heathrow, say UK regional airports

16.6.2011 (Evening Standard)
By Jonathan Prynn

George Osborne was today urged to impose an aviation “congestion charge” on passengers flying
Heathrow and Gatwick.

Regional airports said it was unfair for passengers to fly from packed terminals
when they had huge capacity available.

In a letter to the Chancellor, the 12 airports said a “London levy” would encourage more airlines to start routes from the regions and boost
economic regeneration.

Manchester, England‘s biggest airport outside the South-East, is operating at 57 per cent capacity,
Birmingham at 41 per cent.

Air passenger duty ranges from £11 on a short-haul hop for an economy passenger
to £170 for a business class traveller going to
Australia. Regional airports said people travelling from London should pay even more.
The open letter was sent in response to the Chancellor’s consultation on APD reform.

It says: “Current rates of APD are a barrier to airlines starting new routes
to regional airports. They have no incentive to migrate from the crowded airports
to those in the regions where there is capacity.”

A Manchester Airport official said the Coalition did not back a particular level of extra tax but
said: “Clearly it has to be enough of a gap to make a difference to passengers,
but that’s a matter for the Chancellor.”

But a spokesman for BAA, which owns Heathrow, dismissed the idea, saying: “All
airports support jobs and growth, whether via connections to the regions or links
to other major economies that can only be provided by a hub like Heathrow. Both
are important, and the real issue is not differential taxation but the fact that
UK passengers pay more airport tax than anyone else in Europe. That hurts the

Heathrow is 98 per cent full and is back at pre-recession levels of traffic,
while Gatwick is running at 80 per cent capacity.

The Chancellor froze the duty in the last Budget and ordered a review. The deadline
for responses is tomorrow.