Estimate of The Impact on Emissions of a Reduction in Air Passenger Duty in Scotland
Annex A
Evolution of and changes to UK Air Passenger Duty 1994 - 2015
Introduced in 1994 APD rates were initially differentiated by whether the destination was within or outside the then European Economic Area (EEA). At that time the EEA consisted of the European Community member states - 12 countries - and the 7 members of the European Free Trade Association. As the European Union expanded so member states were included in the EEA.
In 2001 the APD exemption applying to a return leg of a domestic flight was removed, the rates were increased for all destinations and new standard and reduced rates of duty were introduced as shown in Table A1 below. The standard rate was applied to any higher class of ticket than the lowest class on that flight. It took almost a further six years for the rates of APD to be increased again.
In 2009 a four destination band structure was introduced based on geographical distance from London to the capital of the destination country. The four bands are defined as follows:
| Band A | 0 - 2,000 miles |
| Band B | 2,001 - 4,000 miles |
| Band C | 4,001 - 6,000 miles |
| Band D | over 6,000 miles |
The complete history of APD charges is set out in table A1 below.
All domestic and European flights fall within Band A, along with some North African (e.g. Libya) and near Asian countries west of the Urals such as Belarus and Ukraine. Band B covers North America, stretches to Central Africa and to the Middle East. China, India and South Africa are in Band C. For a full country by country breakdown by APD band see the HMRC website.
APD Proposal and Banding
In considering the picture for Scotland, it has been assumed that the same 'capital to capital distance forms the basis of the banding and that the other details of the scheme remain as formulated under the current UK policy. Further, it is assumed that there is no change in banding for any destination when measured from Edinburgh rather than London.
Table A1: Rates of APD since 1994
| Lower Rate | Higher Rate | |
|---|---|---|
| Date of Change | ||
| 01/11/1994 | 5.00 | 10.00 |
| 01/11/1997 | 10.00 | 20.00 |
The lower rate applied to domestic passengers and passengers travelling within the European Economic Area and closely connected destinations
All other destinations attracted the higher rate
| EEA | Non EEA | |||
|---|---|---|---|---|
| Reduced Rate |
Standard Rate |
Reduced Rate |
Standard Rate |
|
| 01/04/2001 | 5.00 | 10.00 | 20.00 | 40.00 |
| 01/02/2007 | 10.00 | 20.00 | 40.00 | 80.00 |
| Band A | Band B | Band C | Band D | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Reduced Rate |
Standard Rate |
Higher Rate |
Reduced Rate |
Standard Rate |
Higher Rate |
Reduced Rate |
Standard Rate |
Higher Rate |
Reduced Rate |
Standard Rate |
Higher Rate |
|
| 01/11/2009 | 11.00 | 22.00 | 45.00 | 90.00 | 50.00 | 100.00 | 55.00 | 110.00 | ||||
| 01/11/2010 | 12.00 | 24.00 | 60.00 | 120.00 | 75.00 | 150.00 | 85.00 | 170.00 | ||||
| 01/04/2012 | 13.00 | 26.00 | 65.00 | 130.00 | 81.00 | 162.00 | 92.00 | 184.00 | ||||
| 01/04/2013 | 13.00 | 26.00 | 52.00 | 67.00 | 134.00 | 268.00 | 83.00 | 166.00 | 332.00 | 94.00 | 188.00 | 376.00 |
| 01/04/2014 | 13.00 | 26.00 | 52.00 | 69.00 | 138.00 | 276.00 | 83.00 | 170.00 | 340.00 | 97.00 | 194.00 | 388.00 |
| 01/04/2015 | 13.00 | 26.00 | 52.00 | 71.00 | 142.00 | 284.00 | 71.00 | 142.00 | 284.00 | 71.00 | 142.00 | 284.00 |