UK government urged to cut air passenger duty

Airport operator BAA has urged the British government to follow the lead of Ireland and rescind recent increases in air passenger duty.

Yesterday the Irish government announced it would cut its Air Travel Tax to €3 from its current rate of €10 despite the ongoing financial crisis.

The change – which it is hoped will boost tourism in the country - will come into effect on March 1st 2011.

Irish finance minister Brian Lenihan did, however, warn the levy could be raised again at the end of the year if airlines did not pass on cuts to consumers.

“The position will be reviewed next year and the rate will be increased unless there is evidence of an appropriate response from the airlines,” he said.

“I do not want to see the reduction in the tax being used by airlines as an opportunity to raise their fees and charges.”

The move follows similar changes in Amsterdam where the tax was cut completely in 2009.

Now, Britain is being urged to follow suit.

BAA Argument

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BAA Heathrow policy director Nigel Milton said: “The Irish recognise aviation is fundamental to their recovery and this is very much something ministers in the UK need to take note of.

“We must stop treating air travel as if it is a luxury we can do without and appreciate the very real contribution it makes to the economy.”

Following increases Britain now has the highest levels of aviation taxation in the world.

Passengers in Band D – those flying over 6,000 miles – can now pay up to £170 in tax for a single premium seat.