Air taxes to come under scrutiny

The government is to look into reforming the aviation tax system, with the Budget following on from the coalition agreement which made a firm commitment to switching from a per-passenger to a per-plane duty to encourage fuller flights.

The budget also confirmed that any major reforms in the area will be subject to public consultation. Matthew Hodkin, tax partner at City law firm Norton Rose, said the key point will be "gearing the duty in a way that benefits greener aircraft", adding: "It will be interesting to see if this remains a priority as the coalition examines the options."