Government advised to halve domestic APD and review distance bands for the tax
Boris Johnson is set to authorise a 50% cut in APD for domestic flights. Senior Whitehall sources say he will announce a review of the tax, which is the only tax on air tickets (on which no tax or VAT is paid). Currently APD is charged at £13 for any adult leaving a UK airport, so that is the cost for any return flight to anywhere in Europe. For domestic flights (for which there is usually a rail alternative) the tax is £26, so it is charged on leaving both airports. The review will also look at the case for increasing the number of international distance bands. Since 2015, there have only been two bands, one covering flights of up to 2,000 miles and the other those in excess of that. The plans to change APD will be put to a consultation, so it is unlikely to be introduced until 2022. The recommendations are part of a wider Union Connectivity Review by Sir Peter Hendy, the chairman of Network Rail, to be published on 10th March, proposing a new “UK Strategic Transport Network” to oversee British transport priorities. Critics say the 50% domestic APD cut — coming just days after fuel duty was frozen for the 10th consecutive year — and rail fare rises, further undermine ministers’ commitment to cutting carbon a target of net-zero carbon by 2050. Doug Parr, chief scientist for Greenpeace UK, said this would “continue our nonsensical trend of the higher the carbon, the lower the tax.”
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Air passenger duty: Review of tax on domestic flights planned
10.3.2021 (BBC)
Boris Johnson is promising a review of air passenger duty on domestic flights in an effort to boost connectivity in areas “left off” the transport map.
A consultation will examine options including creating a new lower domestic rate or exempting return flights.
The move is likely to be welcomed by struggling airline operators hit by Covid but worry environmental groups.
The PM will also announce £20m for rail and road links and a review of a bridge between Northern Ireland and Scotland.
Mr Johnson has championed the idea of a bridge or tunnel connecting Northern Ireland with the British mainland, describing the proposal as “very interesting” despite scepticism from the Northern Irish and Scottish governments. (The Hendy report devotes just two sentences to Johnson’s idea of a new bridge or tunnel – the Boris Burrow – between Scotland and Ireland, which is seen by Treasury officials as an impractical pipe dream.)
Two routes, between Portpatrick and Larne and Campbeltown and the Antrim coast, have been proposed.
Announcing the findings of an interim report into transport connectivity on Wednesday by Sir Peter Hendy, the PM will confirm that a study will be carried out for the first time into the idea’s feasibility.
Mr Johnson will also announce new funding to upgrade road, rail and sea connections across the UK in an effort to reduce delays and bottlenecks and stimulate economic growth.
Among key arteries earmarked for investment include rail routes between the North coast of Wales and England, enhancements to the West Coast Mainline and the dualling of much of the A75 in south-west Scotland.
But a planned consultation on aviation tax reform is likely to prove the most controversial element.
Mr Johnson said he wanted to cut air passenger duty on domestic flights to “support connectivity across the country” and help the economy bounce back from the pandemic.
Airlines have been lobbying for a reduction in air passenger duty, whose standard rate for UK flights is £26 per customer per return flight, long before the Covid-19 pandemic brought the industry to its knees.
But environmental groups say reducing the cost of flying will make it difficult if not impossible for the UK to meet its target of net-zero carbon emissions by 2050 as aviation is the single largest source of emissions.
The review will also look at the case for increasing the number of international distance bands. Since 2015, there have only been two bands, one covering flights of up to 2,000 miles and the other those in excess of that.
Further plans to decarbonise aviation will also be examined, including mandating the use of sustainable aviation fuels across the industry.
Mr Johnson said his government was committed to “harnessing the incredible power of infrastructure to level up parts of our country that have too long been left off the transport map”.
“This pioneering review by Sir Peter Hendy gives us the tools we need to deliver on our ambitions for a UK-wide transport network that encompasses sea, rail, and road,” he said.
Critics say billions of funding is needed to make up for a decade of under-investment in regional transport links in the North of England and that cash has been swallowed up by the multi-billion pound HS2 high-speed rail link.
https://www.bbc.co.uk/news/uk-politics-56339192
Ministers argue that domestic flights only account for 3.8% of UK aviation emissions.
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But Dr Doug Parr, chief scientist for Greenpeace UK, said: “After the fuel duty freeze and rail fare rises, cutting duty on domestic flights would continue our nonsensical trend of the higher the carbon, the lower the tax.
“The government needs to face up to the unavoidable reality that the aviation industry has to be smaller than it was before the pandemic, and get on with the vital job of making that process as painless as possible for the workers, and with the lowest possible impact on the climate.”
Friends of the Earth climate campaigner Jenny Bates said: “It beggars belief that ministers would cut domestic air passenger duty and encourage more people to fly around the UK.
“Our climate has been paying the price for cheap air travel for far too long. A government committed to confronting the climate emergency should be taking steps to make public transport more affordable – not reducing the cost of high-carbon air travel.”
Paul Tuohy, chief executive of Campaign for Better Transport, said it was “enormously disappointing, especially coming a week after a rail fare rise and fuel duty freeze, and makes a mockery of our climate commitments”.
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Until 2015 there were 4 distance bands for APD.
And economy ticket would cost:
£13 for up to 2,000 miles.
£67 for 2,000 – 4,000 miles.
£83 for 4,000 – 6,000 miles.
£94 for over 6,000 miles.
From April 2020 an economy ticket would cost:
£13 for up to 2,000 miles
£80 for over 2,000 miles. (Rising to £82 after April 2021)
Flight duty may be cut to ‘level up’ the regions
BY Graeme Paton, Transport Correspondent (The Times)
Wednesday March 10 2021,
Tax on domestic flights could be almost halved under plans to improve transport connections between different parts of Britain.
Boris Johnson is expected to announce today that the government will begin a consultation into proposals to cut air passenger duty (APD) from £13 to £7 per flight.
The reduction could make domestic flights cheaper than those to short-haul European destinations, incentivising airlines to increase the number of planes on UK routes. After the collapse of the low-cost carrier Flybe in March last year there was a drop in the number of flights from smaller airports across Britain and this was seen as undermining the government’s “levelling-up” agenda.
Environmental groups criticised the plan to reduce the duty as “nonsensical” last night, warning that it would drive up greenhouse gas emissions. However, the government insisted that it would make little difference to overall carbon dioxide levels because of a requirement on airlines to offset any rise in emissions beyond levels seen in 2019. News about APD comes days after ministers announced that they were freezing fuel duty while increasing the price of rail fares in England.
The government has published the interim findings from its “Union connectivity review”, which was commissioned by Johnson last year to improve links between the four nations of the UK. The review, led by Sir Peter Hendy, the chairman of Network Rail, said that concerns had been raised that APD was an “economic barrier”, particularly in Scotland and Northern Ireland.
The review also announced that a feasibility study would be carried out into plans for a tunnel or bridge between Britain and Northern Ireland. The study would analyse the cost, timeframe and practicality of the “fixed link” from Stranraer on Scotland’s west coast to Larne, north of Belfast. Other recommendations include faster rail links from England to Scotland.
At present APD adds £13 each way for all standard-class short-haul flights of under 2,000 miles, or £26 for a return. This covers all European flights. First and business-class tickets cost £26 each way.
The consultation, being launched later in the spring, will suggest introducing a rate specifically for domestic flights. It will propose either abolishing the return leg for domestic flights or introducing a flat £7 rate for all domestic journeys. Ministers favour the latter because of the large number of people who book two single flights rather than one return.
In 2019 about 19.2 million passengers were carried on domestic flights, down from almost 20 million a year earlier and 22.6 million in 2007. The decline has been put down in part to high prices and competition from rail operators.
Tim Alderslade, chief executive of Airlines UK, said that reducing the duty was a “welcome measure of relief to domestic carriers facing an existential threat from the impacts of Covid”.
Doug Parr, of Greenpeace UK, said the plan was nonsensical, adding: “The government needs to face up to the unavoidable reality that the aviation industry has to be smaller than it was before the pandemic, and get on with the vital job of making that process as painless as possible for the workers.”
https://www.thetimes.co.uk/article/flight-duty-may-be-cut-to-level-up-the-regions-7p6lqtjt7
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See also
APD to rise on long-haul only (>2,000 miles) from £80 to £82 from April 2021 – no change in short haul £13 APD
Air Passenger Duty (APD) – the UK duty on flights – is set to increase for flights of over 2,000 miles, in April 2021. The APD will rise from £80 now to £82, for a return flight – APD is only charged on departures. For premium class air tickets of over 2,000 miles, the APD will rise by £4 from £176 to £180. There will be no increase in APD for flights under 2,000 miles, which means any flight in Europe, which will continue to pay just £13 for a return trip (£26 premium class). The rate for long-haul private jet etc rises from £528 to £541. (The distance is measured from London to the capital city of the destination country.) This tiny APD rise is not doing to deter anyone flying. The increase come despite calls from the aviation industry to freeze or even scrap APD due to the problems the sector has because of the Covid pandemic. There have been many calls for APD on domestic return flights to be scrapped, (as the APD is £26, not the £13 for a European flight) but there is no mention of those in the government announcement. Perhaps the government appreciates that airlines take money out of the UK, and passengers to foreign leisure trips, o a far greater extent than they bring money in.
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For a lot more on APD and its rates, see
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