Scotland’s travel agents and main airports have urged Chancellor George Osborne to rethink a planned hike in Air Passenger Duty.
The separate pleas before next week’s budget come ahead of a planned 8% hike in the tax from April.
In a open letter to the chancellor George Osborne, Scottish Passenger Agents Association president Kevin Thom condemned APD as being “particularly iniquitous” in its effect on Scottish aviation and on businesses, including inbound tourism.
“APD gives us genuine cause for concern, and as a partner in Abta’s Fair tax on Flying initiative we continue to campaign for its removal or at the very least a significant reduction,” he said.
“The government claims on one hand it aims to boost and grow our economy through international trade, yet on the other hand they are intent on pricing the UK out of the international market place.
“In your Autumn Statement you raised the point of not wanting to price British business out of the world economy but this is precisely what you are doing,” Thom argued.
The SPAA letter also raises the impact of the EU Emission Trading Scheme in January as a secondary level of taxation on flights.
“Although we applaud any steps to reduce carbon emissions, we do not feel it is acceptable for aviation to be penalised twice,” Thom said.
The bosses of BAA’s Scottish airports – Aberdeen, Edinburgh and Glasgow – called on Osborne to rethink APD plans “to give our airlines and airports a fighting chance” to compete against European rivals and also expresses concern about double blow of increased APD and the ETS.
The airports, which collectively handle more than 19 million passengers a year, warn that Scotland and the UK are losing out to Europe because of spiralling APD levels, now the highest in the world.
The joint letter from managing directors Derek Provan (Aberdeen), Jim O’Sullivan (Edinburgh) and Amanda McMillan (Glasgow) said: “With the industry in Britain bracing itself for further rises to this already disproportionate tax, our competitors in Europe – where many governments have reduced or removed passenger duty entirely – continue to enjoy a competitive edge over UK airports.
“In Scotland, we have particular concerns about our future ability to attract new airlines in what is an intensely competitive global market.
“There is a risk that airlines looking to serve new markets will choose other European countries at the expense of Scotland. This in turn will have a significant impact on employment, business competitiveness and inbound tourism.”
A BAA report in 2011 warned that further increases in APD could cost Scotland’s airports around 1.2 million passengers over three years, with a corresponding financial cost of £77 million in lost tourism revenue.
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