Low-cost heavyweights condemn APD decision

Ryanair and easyJet have both condemned the UK government’s increase in air passenger duty (APD) for short haul traffic from £10 to £11 in 2009 and £12 in 2010.Ryanair claimed that the rise will “devastate UK tourism”, saying that the increase in APD was “regressive, damaging to the UK tourism industry and devastating for regional airports”.

It said the tax, which has been billed as an environmental tax, had contributed “not one penny” so far towards environmental issues. It added that the tax “fails to reward airlines, such as Ryanair, which invest in brand new aircraft and operate younger, cleaner, more environmentally friendly aircraft”.

The Irish carrier confirmed that it would enter into discussions with regional airports about the future viability of passenger traffic and growth in light of the increased cost.

Ryanair’s Michael Cawley said: “This Government must realise that it can’t tax the tourism industry out of a recession. BAA traffic figures show that passenger traffic has fallen since this tax was introduced and this increase will have a further damaging effect on passengers.

“BAA traffic fell by 5% in September and 6% in October with the first 10 months of the year showing a decline of 2%. As Ryanair has repeatedly shown, the tourism industry can only grow and thrive if it has lower access costs and not idiotic regressive taxation which hits the poorest, most price sensitive passengers, and makes UK tourism an increasingly unattractive option,” he added.

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“Our greatest concern is the devastation this regressive tax will have on our regional bases, which we have grown due to Ryanair’s commitment to lowering fares. The Government is insane if it thinks these price sensitive passengers will continue to travel if faced with increased costs”.

“This Government must realise that it can’t tax the tourism industry out of a recession.  BAA traffic figures show that passenger traffic has fallen since this tax was introduced and this increase will have a further damaging effect on passengers.  BAA traffic fell by 5% in September and 6% in October with the first 10 months of the year showing a decline of 2%.  As Ryanair has repeatedly shown, the tourism industry can only grow and thrive if it has lower access costs and not idiotic regressive taxation which hits the poorest, most price sensitive passengers, and makes UK tourism an increasingly unattractive option.

Meanwhile Andy Harrison, easyJet’s Chief Executive said: “I am dismayed that the Chancellor has failed to carry through his commitment to reform a bad tax. All Parties agreed that APD needed to be changed to a tax on planes not people, but now the Government has succeeded in bodging-up the reform of an already bodged tax. He has made a bad situation worse by increasing the burden of APD on hard working families.

“The Chancellor said that he wouldn’t allow the economic crisis to “push aside the importance of protecting the environment” but his green credentials have been brushed aside in a dash for cash and the emissions from cargo planes, private jets and transfer passengers continue to be tax free. So, Roman Abramovich, FedEx and Heathrow’s transfer passengers will continue to be exempt, but hard-working families going on their summer holiday on environmentally-efficient low-fare airlines will now pay even more!!”
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