Monday, 12 March 2012

Report attacks planned rise in Air Passenger Duty

Budget week - the time when every market researcher does some work to state their case against The Chancellor and his red briefcase.

This time I think I agree with a report conducted by The World Travel & Tourism Council which attacks the governments proposed 8% rise in Air Passenger Duty (APD). In real terms, the incremental cost for a family of four flying to Spain would rise by £52, or for a family to Florida, by £260 extra.

These figures are indisputable but the report goes further in its analysis of what a cut in APD would do to the economy. The report suggests that such a change could create 91,000 jobs and add £4.2bn to the economy. I am not convinced by the projected number of new jobs or the amount earned from new revenue which the report claims will be put into the economy as they seem fantastical.

Yet to continually increase tax on people flying into the UK is very harmful for it's business and tourist visitors. The government would clearly love for Briton's to holiday in these isles as a £4m tourism campaign has shown but the country's adverse weather means that it's citizens will long for a week in the sun. The government plans to continually increase APD to 2016 when foretasted taxation would mean a family of four would pay APD of £500 to a long haul destination. We currently have the highest aviation taxes in the world and we will continue to be more and more isolated if this continues.

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