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WTTC: APD doing substantial damage to the UK economy

WTTC: APD doing substantial damage to the UK economy

Air Passenger Duty (APD) is doing more harm than good to the UK economy, according to new research, with the controversial air tax costing 91,000 jobs a year.

The World Travel & Tourism Council (WTTC) claims the tax is acting as a brake on the economy and argues removing APD would result in £4.2 billion added to the economy in 12 months.

The research comes as Britain is about to face yet another rise in Air Passenger Duty.

Increases planned from April mean a family of four flying to Malaga will pay £52 extra on the price of their tickets.

This rises to £260 for the same family to fly to Florida and £368 to fly to Australia.

WTTC president David Scowsill said: “Air Passenger Duty is a completely disproportionate tax on people’s holidays and is hitting business travel hard.

“When the economy needs help, it is economically illogical to continue with a tax that costs the country some 91,000 jobs and as much as £4.2 billion.”

In the next 12 months, the UK Government will collect £2.8 billion in extra tax from air travellers, far more than any other country in the world.

David continued: “Travel grew by 4.1 per cent in the UK last year, but is forecast to slow to 1.3 per cent in 2012.

“This slowdown is partly due to the impact of Air Passenger Duty, which is dampening demand.”

This tax is damaging the economy at a crucial time, and is having a negative effect on trade with countries in the Caribbean, Africa and Asia. We urge the UK Government to recognise the impact on the overall economy and reduce Air Passenger Duty.”

Martin Craigs, chief executive of the Pacific Asia Travel Association (PATA), said: “The UK is an island trading nation, air services are the vital lifeblood of modern global commerce.

“The UK Air Passenger Duty is now the world’s highest by a wide margin. It is certainly turning away tourism and trade from the world’s fastest growing economic region Asia Pacific.”

“Airport Passenger Duty started in 1994 at £5 and some worthy intentions to offset aviations carbon footprint.

“Today at £85 to zone D (Asia/Pacific) it’s a ‘detention tax’ that’s restricting job growth, alienating important trade partners and not being transparently directed to green projects.

“Airport Passenger Duty maybe easy to collect but it’s also easy to see its macroeconomic damage,” he concluded.