Cutting APD

By | Category: Travel news
From Flybe's CEO comes a sensible idea the government may consider

From Flybe’s CEO comes a sensible idea the government may consider

The head of Flybe, Saad Hammad has written to the government to call for a 50% cut in air passenger duty at regional airports. But, as Just about Travel has mentioned before, the government takes about £4 billion so what makes Hammad think they might listen to his plea?

He argues that he cuts could be paid for by increasing the amount paid by passengers travelling through airports in London. In this way, his cut would be neutralised by the additional revenue and the government wouldn’t lose by it.

He argues that, with Scotland planning to cut APD by 50% and Wales considering it, if England were to do the same (bar London) regional airports would not be at risk of a drain of passengers to cheaper APD airports. In particular it is thought that Newcastle-upon-Tyne airport would suffer from any Scottish reduction and Bristol would be similarly hit if Cardiff Airport operated at 50% of the current APD rate.

But as I have written, other airports such as Manchester, Leeds and Birmingham might also suffer if passengers could see savings over the cost of travel.

Hammad’s suggestion is the first I have heard for a while that could be attractive to the government and also be welcomed by the English regions. And it needn’t come into being until the Scottish and Welsh governments act. The Treasury in London can have its cake and eat it.

His plan has one other benefit. As he points out in his letter, it would provide an economic incentive for the immediate use of spare runway capacity available today at regional airports neighbouring London such as Birmingham Airport.

 

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