Leading airline bosses have united in condemning the government for refusing to reconsider rises in Air Passenger Duty (APD), dismissing the Chancellor’s talk of boosting growth as “empty rhetoric”.
Willie Walsh, head of British Airways’ parent IAG, joined easyJet chief executive Carolyn McCall, Ryanair boss Michael O’Leary and Virgin Atlantic chief executive Craig Kreeger in a statement saying the government’s policy “beggars belief”.
Their joint statement said: “We are very disappointed the government’s tax on flying, already the highest in the world, will increase yet again this year and next.
“These rises in APD show the emptiness of rhetoric on boosting exports to emerging economies and building the most competitive tax system in the world.
“Increasing this alarmingly uncompetitive tax on business, trade, and inbound tourism beggars belief when the evidence clearly suggests that abolition would deliver growth, create 60,000 jobs and pay for itself through higher receipts from other taxes.”
The four airline chiefs commissioned PwC to produce a report, published in February, on the impact of abolishing APD. This concluded abolition would have a positive impact on GDP. However, the Treasury dismissed the findings.
Chancellor George Osborne signalled no change in policy on APD in his Budget speech today.
APD rates will therefore rise on April 1 (Easter Monday), with a £2 increase in duty on economy long-haul fares to £67, £83 or £94 depending on the destination, but with no change in the short-haul economy rate of £13.
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