Virgin Atlantic slams Treasury over APD

Virgin Atlantic slams Treasury over APD

Virgin Atlantic has accused the Treasury of ignoring the “vast majority of responses” to a consultation on Air Passenger Duty (APD).

Treasury secretary Chloe Smith revealed just eight out of 136 respondents argued for retaining the current four-band APD regime in the consultation earlier this year, compared with 77 which recommended a move to two bands. Another 51 advocated alternative band structures.

The Treasury announced last week it would retain the four-band regime and the double-APD rate on premium economy fares. It confirmed an 8% rise in rates from next April following the Chancellor’s autumn statement.

Responding to Parliamentary questions from Crawley MP Henry Smith, the Treasury secretary also revealed that 54 out of 70 respondents called for the reclassification of premium economy. Just 11 out of 70 supported retaining the existing double-rate on premium-economy fares.

A Treasury spokesman told Travel Weekly the government had “consulted widely” before deciding to keep the current banding structure.

He said: “Given any reform of APD banding would need to be revenue-neutral, it would inevitably lead to shorter-haul passengers paying more. We therefore decided against a costly and disruptive overhaul of APD at this time.”

However, Virgin Atlantic chief commercial officer Julie Southern said: “What’s the point of a costly consultation if you are going to ignore the vast majority of people and go with just 6% of responders on the key issue?

“There were clear majorities in favour of a simpler two-band system and ending the ridiculous rules which mean Premium Economy passengers pay the same rates as those in Upper or First class.”

Southern added: “We cannot understand why the Treasury continues to claim changing the banding structure ‘would lead to an increase for 91% of passengers’. This is simply untrue. It depends on the rates chosen for the different bands.”

Treasury figures show 76 million (78%) of passengers from the UK fly short haul to destinations in band A and 12 million (13%) to destinations such as the US in band B.


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