Govt urged to scrap ‘hugely anti-competitive’ APD

Abolishing APD a quick route to growth - BA boss Willie Walsh
Abolishing APD a quick route to growth - BA boss Willie Walsh

The UK should scrap Air Passenger Duty (APD) so foreign tourists are not charged to fly home, the boss of British Airways’ parent company has said.

IAG chief executive Willie Walsh said it was wrong for the Government to “spend hundreds of millions of pounds to attract people to come to this country only to charge them when they want to leave”.

Mr Walsh was speaking at a media event in north London held by Airlines for Europe (A4E), a lobby group representing carriers such as easyJet and Ryanair.

A report published by the organisation claimed that abolishing APD would boost UK GDP by 1.7% and create 61,000 new jobs by 2020.

It stated that passengers had paid £31 billion since APD was introduced in 1994 and the UK had the highest aviation tax in the world.

The tax rate for economy passengers is £13 for short-haul trips and £73 long-haul. For higher classes the rate is £26 short-haul and £146 long-haul.

EasyJet CEO Dame Carolyn McCall told reporters: “If you’re flying to Scotland and back currently you’re paying nearly £30 in APD. Our tickets aren’t even that. That is more than the price of a ticket.”

“We believe at A4E that that is hugely anti-competitive for Britain.”

There was “ample evidence” around Europe, she said, to show that flight taxes were “counterproductive”, such as in Ireland, the Netherlands and Italy.

“Suppressing growth is not what this economy needs,” said Mr Walsh.

“We need to pursue growth and it’s very clear that a quick win is to abolish this tax because it will have a net positive impact on the UK economy.”

He revealed that he had told Transport Secretary Chris Grayling that APD was a “huge factor” in IAG deciding where to put its aircraft.