Help 'just managing' families by reducing UK's excessive tax on flying
Writing for PoliticsHome's Central Lobby, Conservative MP Henry Smith calls on the Chancellor to reduce Air Passenger Duty in his Autumn Statement tomorrow.
This month’s Autumn Statement is an ideal opportunity for the Chancellor to show the world that Britain is open for business, and create a fairer tax environment for businesses across the country, by cutting Air Passenger Duty (APD).
But we mustn’t forget the many hardworking families up and down the country who are burdened by the UK’s excessive tax on flights.
Every day, hardworking families across the UK are paying significantly more tax than our European neighbours to fly. Halving APD would make a substantial difference to people from Crawley to Carlisle by making domestic and international flights more affordable – as well as giving a vital boost to incoming tourism and foreign investment in Britain.
APD is an outdated and flawed tax that puts the UK at a disadvantage to our European, and indeed global, counterparts. Since it was introduced in 1994 it has increased by over 824%, while families in other European countries have benefited from equivalent taxes being lowered or even abolished. Britons should be able to enjoy family holidays without being charged a premium for departing from the UK.
As it stands, we have the highest rate of air travel tax in Europe. Reducing APD by 50 per cent would bring us in line with Germany, which has the second highest. After the vote to leave the EU, it’s not only fair, but essential that British families have access to a level playing field compared to the rest of Europe.
APD is a burden on the family budget, putting UK families at a disadvantage compared to European families. Even with the recent changes to APD, which rightly exempted children from paying the tax, a family holiday remains a significant purchase, in part because of the high amount of APD paid on adult tickets.
APD is also an obstacle to economic growth. Analysis by PwC found that abolishing it would boost UK GDP by 1.7% and create 61,000 new jobs by 2020. Removing air travel taxes has already resulted in significant economic success in other countries. The Republic of Ireland, for example, abolished its minimal air tax in 2014 and since then Dublin airport has gone on to achieve the highest rate of passenger growth of any major European airport.
With the Scottish Government now pledging to cut APD when the relevant powers are devolved, the rest of the UK risks being left behind and put at a disadvantage. The result of this will be that families in Stirling will pay less tax to fly than families in Southampton, turning APD into a postcode lottery. This is not fair. What is needed is an even and consistent tax across the whole country.
APD is one of our most archaic taxes, revealing an unfair system in which families and businesses in Britain pay more than those in other European countries. At its current level, it stalls economic growth, keeps us from creating the jobs that will improve the lot of the ‘just managing’, and prevents our economy from reaching its full potential. Now is the time to take action and reduce the tax across the whole of the UK.
I hope the Government will use this month’s Autumn Statement to commit to reducing this damaging and unfair tax.
Henry Smith is the Conservative MP for Crawley