TUI chief blasts APD alternative

TUI chief executive Peter Long has attacked reports that the UK government planned to drop the proposed per-plane levy as an alternative to APD.

The government has admitted that it could not find a way forward with APD.

International aviation regulations that make taxing plane fuel illegal have caused the impasse.

But Long said the tax would be far fairer and more environmentally friendly.

In a statement, he said: “Each of the Conservatives and the Liberal Democrats committed in their election manifestoes to replace APD with a per plane tax.  This commitment was repeated in the Coalition Agreement.

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“This was, and is, the right policy and represents a promise made by this Government to the British people.  It forms part of the basis upon which this Government was elected.

“APD in its current form is not focused on environmental benefit.  A per plane tax would be the simplest way of reforming this tax and achieving a tax system that properly rewards and incentivises environmentally responsible behaviour.  We expected the government to stand by its commitments to reform the aviation taxation system in this way.”

He added: “We are surprised by the comments that a per plane tax may breach the Chicago Convention.  The method of calculation we had proposed to Government would be one that mirrored the European Union Emissions Trading Scheme (EU ETS).  If EU ETS is compliant with the Chicago Convention, then we believe that a Per Plane Duty would be equally compliant.”

Long said that if APD was to be retained, changes needed to be made.

He said: “The government must, as a minimum, make changes to the current banding system and to the tax rates for premium economy seating. The current banding system sees flights to the Caribbean taxed more heavily than flights to Hawaii or the West Coast of the USA.