APD "a barrier" to tourism growth
Ministers, Airports and tourism leaders have joined forces to demand that Air Passenger Duty (APD) be devolved as soon as possible.
Ahead of the busy summer holiday season, figures illustrate that the latest increase means that from 1st April, a family of four flying in economy class from the United States has to pay £268 to add Scotland/the UK to their European itinerary, or a couple from Spain have to pay an extra £52 to fly premium economy return here.
VisitScotland, Ministers Aberdeen, Glasgow and Edinburgh Airports are all calling on the UK Government to look at APD as a matter of urgency to help Scottish tourism thrive in the future.
Transport Minister Keith Brown said:
"Scotland will welcome the world in 2014 courtesy of the Commonwealth Games and Ryder Cup, and yet we are in the absurd situation of increasing costs for people who intend to visit Scotland. The 'World Economic Forum, Travel & Tourism Competitiveness Report 2013’ shows that the UK has amongst the highest aviation taxes and charges in the world, ranked 139th out of 140. I would urge the UK Government to deliver devolution of APD as soon as possible so that we can develop a regime that makes Scotland more competitive."
York Aviation research on behalf of Scotland’s major airports has demonstrated the current APD level will cost the Scottish economy around £200 million a year in lost tourist revenue by 2016. Ministers believe devolution of the tax would enable the development of a regime which supports more direct international air routes, reducing the cost of flights for passengers.
Mr Brown added:
“The current level of Air Passenger Duty applied by the UK Government is financially punitive for everyone involved – holidaymakers, tourists coming to Scotland, businesses and for the Scottish economy as a whole. It is now the highest tax of its type anywhere in the world, a ridiculous situation when you consider that it is applied uniformly across the UK, with no consideration given to the differences between a huge, hub airport like Heathrow, and smaller regional airports such as Dundee.
“Anything that increases the costs for people visiting Scotland is a barrier than can be expected to have a detrimental impact on our tourist industry, and we have campaigned for some time now to have this tax devolved, as it has already been in Northern Ireland.
“Responsibility for APD would allow the Scottish Government to develop a regime that makes Scotland more competitive, helping our tourism sector, increasing business connectivity and enabling us to attract more direct international air routes. Crucially, it would also reduce the cost of flights for passengers.”
Mike Cantlay, Chairman of VisitScotland, said:
“As we look ahead to the spectacular opportunity to reposition Scottish tourism when Scotland welcomes the world in 2014, I know that the industry is extremely anxious about how accessible and competitive Scotland will be in terms of access by air.
“Survey after survey shows the sheer lunacy of inbound APD and that overall the exchequer will suffer from discouraging visitors to fly to the UK. That combined with issues at Heathrow and the challenges Scotland has faced providing connectivity to certain airlines and networks has without doubt impacted on our international visitor numbers. Whilst the new Virgin Atlantic Little Red service will help resolve some of these issues in Edinburgh and Aberdeen, Glasgow is still severely disadvantaged.”
Aberdeen Airport Managing Director Nick Barton said:
"There is no doubt that APD is having a direct impact right now. A family of four flying between Aberdeen and Florida this year will pay more than £300 in APD alone, and that, for most people, is unrealistic. APD is hitting the passenger in the pocket, and we will continue to do what we can to attempt to bring about a change in this damaging tax."
Gordon Dewar, Chief Executive of Edinburgh Airport said:
“This tax has now hit its tipping point where the damage that it is doing to Scotland far outweighs the benefits. It cannot stand and must be reviewed as a matter of urgency.
“The impact of APD goes far beyond the boundaries of the airport, not just in Scotland, but across the world. Airlines are telling us that they are seeing it have an impact on passenger flows which is ultimately having an impact on their decision making on where to put planes. This means that our country has to work harder to get the connections it requires.
“The evidence lays bare the argument that this tax is assisting with the deficit. Rather, APD is hindering our ability to tackle the economic challenges Scotland faces.”
Background
A report by York Aviation commissioned last year by Edinburgh, Glasgow and Aberdeen airports concluded that the current level of APD would see Scotland lose two million passengers and £210 million a year in tourist spend by 2016.
A recent PWC report commissioned by British Airways, easyJet, Ryanair and Virgin Atlantic showed that it was the highest tax of its type in the world and its abolition would create 60,000 jobs in the UK.
The World Economic Forum ‘Travel & Tourism Competitiveness Report 2013’ shows that the UK has amongst the highest aviation taxes and charges in the world, ranked 139th out of 140. Ministers continue to call for the devolution of Air Passenger Duty as soon as possible so that we can develop a regime that makes Scotland more competitive.
UK APD bands from 1 April 2013
|
Band |
Miles from London |
Economy Rate |
|
A |
0 - 2,000 |
£13 |
|
B |
2,001 - 4,000 |
£67 |
|
C |
4,001 – 6,000 |
£83 |
|
D |
Over 6,000 |
£94 |
Rise in APD since 2007
|
Economy |
Example Country |
2007 |
2012 |
Increase |
|
Band A |
EU |
£5 |
£13 |
160% |
|
Band B |
UAE/USA |
£20 |
£65 |
225% |
|
Band C |
China/India |
£20 |
£81 |
305% |
|
Band D |
Australia |
£20 |
£92 |
360% |
|
Non Economy |
Example Country |
2007 |
2012 |
Increase |
|
Band A |
EU |
£10 |
£26 |
160% |
|
Band B |
UAE/USA |
£40 |
£130 |
225% |
|
Band C |
China/India |
£40 |
£162 |
305% |
|
Band D |
Australia |
£40 |
£184 |
360% |
Contact: Transport Scotland, 0141 272 7195