The level of Air Passenger Duty paid by non-economy passengers departing on flights from the UK is set to increase, with details expected to be confirmed later today.
Following speculation about a duty increase for premium travellers, the Chancellor of the Exchequer Jeremy Hunt confirmed a "one-off adjustment" to APD rates in his budget announcement today.
APD for passengers travelling in seats with a pitch of greater than 40 inches currently ranges from £13 on domestic flights up to £200 on flights of more than 5,000 miles.
Clive Wratten, chief executive of the Business Travel Association, said the increase in non-economy APD is “disastrous for the economic welfare and wellbeing of British businesses and their employees.”
He continued: “Contrary to common misconceptions, business travel is not just for the wealthy. This tax will hinder growth for small and medium enterprises through limiting international collaboration opportunities. It will hit charities, academics and researchers alongside businesses of all sizes combatting rising costs in every area.
“There is no mechanism for ensuring that the monies from this tax will go into innovation in the airline sector nor into Sustainable Aviation Fuels. This is therefore just another tax on British businesses.”
Karen Dee, chief executive of the Airport Operators Association (AOA), said: “It is disappointing to see the Chancellor increase Air Passenger Duty
for business travellers, especially when data show this group is still
to recover to 2019 levels.
“Business travellers are responsible for increasing foreign investment
in the UK, for opening new markets for our goods and services, and
creating jobs across the country.”
Meanwhile Mark Tanzer, chief executive of travel association ABTA, commented: “Any additional or new taxes on aviation have the potential to be a drag on our sector, at a time when the UK already has one of the greatest air travel tax burdens in the world.”
And Ian Sinderson, CEO of travel management company ATPI, said it “urges the government to stop treating the travel industry as a bottomless pit of potential taxation and, instead, create a more competitive market for airlines and travellers, in line with the prices enjoyed by our European neighbours.”
APD rates for some bands were already due to increase from 1 April this year,
with standard rates (for travel in classes where the seat pitch is
greater than 40 inches) on domestic flights rising from £13 to £14,
Standard Band B rates (for flights of 2,001 to 5,000 miles) increasing
from £191 to £194, and Standard Band C rates (for flights of more than
5,000 miles) rising from £200 to £202. The Standard Band A rate (for
international flights of up to 2,000 miles) is due to remain static at
£26.
Previously announced increases will also see the reduced rate (for economy class passengers) increase from £6.50 to £7 for domestic flights, and Band B and C rates both increase by £1 to £88 and £92 respectively.