Virgin Atlantic calls for short-haul APD increase

Virgin Atlantic calls for short-haul APD increase

Virgin Atlantic has called for air passenger duty (APD) on short-haul flights to be raised to £20 from the current £12.

The carrier issued the demand today, arguing passengers flying longer distances “have suffered far greater tax increases”. It suggested increasing APD on flights to Europe would be “fairer” and that an £8 increase would be no more than “low-cost airlines charge to book with a debit card”.

Virgin Atlantic claims long-haul passengers are subsidising the tax rate on short-haul passengers by £222 million a year. The airline’s intervention puts it in direct opposition to easyJet, which has consistently argued long-haul passengers should pay higher rates of APD. It also follows a series of conflicting statements on APD by other industry members.

Mike Greenacre, managing director of The Co-operative Travel and an Abta board member, argued last week for “a congestion charge on the busiest airports to incentivise carriers to switch to airports outside the southeast”.

Greenacre, who was speaking at a Waterfront conference on aviation in London, made clear he advocated the congestion charge in his role as head of The Co-operative Travel. The Fair Tax on Flying coalition, headed by Abta, does not support a congestion charge and many of its members would be bitterly opposed.

EasyJet and Virgin Atlantic are both represented in the ‘Hands off our Holidays’ campaign launched last week by the Airport Operators Association and airline groups.

Virgin Atlantic chief commercial officer Julie Southern said: “APD has rocketed, with a family of four potentially facing a £260 tax bill to fly to Orlando. Steps need to be taken to bring this under control.”

“A new two-band structure with a £20 short-haul rate would redress the balance,” she said. “Our proposals would raise £650 million for an increase comparable with the fees many low-cost airlines charge to book with a debit card.”

Virgin Atlantic said more than two million passengers flew last year from London to destinations in Europe that could be reached in two hours by Eurostar.

Southern added: “The current short-haul rate is clearly not deterring people from taking flights to places where a quick and easy rail alternative exists. If this suffocating tax is going to stay, it must be fairer and drive the right behaviour.”

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