Aviation tax changes "will hit economy and jobs"
18 May 2011 09:31
Proposed changes to the Air Passenger Duty (APD) airport departure tax would have a "destructive" effect on the economy, the environment and jobs, a report commissioned by budget airline easyJet said today.
The changes would reduce UK passenger numbers by three million a year, increase CO2 emissions by 360,000 tonnes a year and reduce tourist spending in the UK by £475 million a year, the report said.
The report by consultants Frontier Economics also said the changes would reduce UK gross domestic product by £2.6 billion a year, lead to the loss of up to 77,000 jobs and affect regional airports more than London airports.
Published in March, the Government proposals would increase APD from £12 to up to £16 per person for flights up to 2,000 miles and reduce the rates and number of tax bands on long-haul flights.
The report found that, although the changes would reduce the total number of flights, they would increase CO2 emissions by encouraging more long-haul flights.
Rather than APD, easyJet favours a per-plane tax - an alternative that was, at one point, considered by the coalition government.
EasyJet chief executive Carolyn McCall said: "This independent report shows that the Government's proposals on APD would be bad for the environment and the economy. APD has already risen by 140% since 2007 on short-haul flights.
"This report provides convincing evidence that the Government should not impose further increases in APD on short-haul flights and should rethink its policy on aviation taxation. Four out of five British passengers would be better off under a per-plane tax and, more importantly, it would encourage the industry to fly more efficiently."
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