Scottish commitment to cutting APD welcomed

Scottish commitment to cutting APD welcomed

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Confirmation of Scottish government plans to halve Air Passenger Duty has been welcomed by airline trade body the British Air Transport Association (Bata).

Ministers in Scotland plan reduction and reform of the air tax as part of devolution plans and last month established a Scottish APD stakeholder forum.

The publication of the Scottish government’s programme for government 2015-16 yesterday saw it initially commit to cutting the tax by 50% when a Scottish version of APD is introduced in 2018.

The Edinburgh government said: "We will reduce the burden of APD by 50% with the reduction beginning when we introduce a Scottish APD in 2018, with a view to abolishing it completely when resources allow.

“We are currently consulting with stakeholders on the best way to apply that reduction across new and existing routes.

“We are committed to replacing APD with a more competitive regime that better supports our goal of boosting international connectivity and business growth.

“We have established a forum, with membership from the airline industry, Scotland's airports, environmental groups, business organisations and tax professionals.

“This forum will support the development of our policy proposals, including helping us to shape a policy consultation on a Scottish APD which we plan to launch this October.

“The Scottish parliament will be able to legislate for a replacement Scottish tax only once the new Scotland Bill has been passed by the UK parliament.”

The policy consultation on APD was announced last month by Scotland’s deputy first minister, John Swinney, and infrastructure secretary, Keith Brown.

Bata chief executive, Nathan Stower, said: “The Scottish government’s commitment to reduce the burden of APD by 50% from 2018, with a view to abolishing completely in due course, is good news for Scottish businesses, families and visitors.

“Halving the UK’s current rates would bring Scotland broadly in line with Germany’s aviation tax.”

Swinney said: “The APD stakeholder forum brings together interested parties – from those in the aviation industry to environmental groups and tax practitioners – to provide expert input into how a replacement tax could work.

“We want to be consultative and collaborative as we have been with the new fiscal levers already devolved to Scotland.

“The forum and this autumn’s policy consultation allow us to take the next step and begin the process of designing and developing a Scottish APD to help deliver our objective of sustainable economic growth.”

Brown added: “UK APD has been the most expensive tax of its kind in Europe and continues to act as a barrier to Scotland’s ability to secure new direct international services and maintain existing ones.

“Devolution of APD to the Scottish parliament will provide the opportunity to put in place new arrangements which better support the Scottish government’s objective to help generate new direct routes and increase inbound tourism.

“Our plan to initially cut APD and then abolish it when public finances permit is a fundamental component to improving Scotland’s international connectivity.”

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