Aviation tax: Flights tax increase is grounded for a year
Thursday 24 March 2011
Holidaymakers were spared an increase in flight taxes after George Osborne delayed a with-inflation rise in Air Passenger Duty (APD) until April 2012. The Chancellor said he would propose clawing back some of the money by imposing a tax on private jet users, who are currently exempt from APD.
Passengers on ordinary flights currently pay up to £170 in APD every time they fly. Ministers had examined options for reforming the tax, including a plan to impose duty on aircraft instead of on travellers, in an attempt to boost the Coalition's green credentials. But Mr Osborne said all of the alternatives which had been looked at were found to be illegal under international law. However, he still intends to reform anomalies in APD, such as flights to the Caribbean attracting a higher tax than flights to California, even though California is further away.
A per-plane tax would have discouraged airlines from running aircraft half-empty, as they currently do, and helped to minimise their impact on the environment. Mr Osborne said he was "reluctantly" shelving that plan "given concerns over the legality and feasibility of this approach".
Tour operators including Thomas Cook and TUI Travel were disappointed, saying that the Chancellor wanted to penalise the airlines which carried most passengers.
Britain has to agree any shift in taxation with other countries as part of international obligations including the Air Service Agreements and the 1944 Chicago Convention. Andrew Tailby-Faulkes, a tax partner at Ernst & Young, said: "This is a blow to the Treasury finances and the Government's green policies."
The Independent travel offers: Discover a world of inspiring destinations
- 1 Bill Clinton portrait features Monica Lewinsky reference, artist admits
- 2 What happens to your body when you give up sugar?
- 3 Delhi bus rapist blames dead victim for attack because 'girls are responsible for rape'
- 4 Have sex with your iPad thanks to the new sex toy no-one asked for
- 5 Average penis size revealed: Scientists attempt to find what is 'normal' to reassure concerned men
Luggage: The journey from canvas rucksacks to carry-on capsules
Eurostar re-opens between London and Paris after person killed by train in Kent
The Atlas of Beauty: Photographer travels around the world to capture cultural diversity through stunning portraits of women
The 10 Best lightweight luggage
The 10 Best hiking boots
New theory could prove how life began and disprove God
'Jihadi John': CAGE representative storms off Sky News accusing Kay Burley of Islamophobia
This is what it's like to be dead, according to a guy who died for a bit
Durham Free School: 'Creationism taught at' free school facing closure
Ukip would cut billions from Scottish budget to fund English tax cuts
Nearly 100,000 of Britain's poorest children go hungry after parents' benefits are cut
£16000 - £18000 per annum: Recruitment Genius: Located on the stunning Sandban...
£12500 - £13520 per annum: Recruitment Genius: Experienced Hotel Receptionists...
£12500 - £13520 per annum: Recruitment Genius: Located on the stunning Sandban...
Negotiable: Recruitment Genius: Qualified Lifeguards are required to join a fa...