Opposition grows to Coalition plan to raise revenue
The air freight industry has hit out at the UK government’s plans to scrap the Aviation Passenger Duty (APD) in favour of a “per-plane” tax that would further damage the industry and drive business away.
IFW this week launched a campaign to oppose the plan. Editor Kizzi Nkwocha believes a more sensible way of raising revenue would be to examine the level of ADP – rather than introducing a new, draconian tax system.
IFW also believes a more practical way of encouraging environmental awareness in the air industry is to reward increased investment in ways of reducing emissions.
The Freight Transport Association (FTA) also believes there are better ways of tackling emissions from aviation, which do not leave UK businesses at a competitive disadvantage.
Christopher Snelling, the FTA’s Head of Global Supply Chain Policy, said plans to impose a perplane emissions tax and to cancel the construction of a third runway at Heathrow would drive business to other European countries and goods will be trucked across to the UK instead.
“The net result will be increased costs, reduced service and greater unreliability – exactly the opposite of what internationally competing UK businesses need.”
British Airways said the tax would create a financial incentive for customers to move cargo through European hubs, which could lead to higher emissions, while Virgin Atlantic believed the tax would be unworkable.
The British International Freight Association’s Director General, Peter Quantrill, said: “The plane tax proposal is not new – the previous government considered it, but realised after consultation with trade, including Bifa, that there were a number of show-stopping impracticalities to the scheme. “The danger is that the unintended consequences will include inflicting more damage on the UK’s position as the key European hub for airlines and cargo by charging what, in most cases, will be an extra-territorial tax on operations.”
The Air Transport Association of America, the trade organisation for major US airlines, has also publicly opposed the UK government’s plan to impose per-aircraft taxes. It said: “Further burdening air transport with another tax puts the wellbeing of our customers at risk. That is crystal clear “It is a plan to financially penalise airlines and thereby force them to cut back air services that shippers want,” The association stressed that international treaties prohibit the UK from charging per-aircraft fees on international flights.
Source: Katerina Kerr, IFW News, 03 June 2010