Families face paying more for their big holidays and visits to relatives in far-flung places after Rishi Sunak said taxes would be raised on ultra-long-haul flights.
The Chancellor has increased Air Passenger Duty (APD) for flights of over 5,500 miles, which includes places such as New Zealand, Australia, South Africa and Japan.
The move is likely to be billed by the Treasury as a demonstration of Mr Sunak’s commitment to the green agenda ahead of next week’s Cop26 climate summit in Glasgow.
Families face paying more for their big holidays after Rishi Sunak said taxes would be raised on ultra-long-haul flights
But Mr Sunak also said flights between airports in England, Scotland, Wales and Northern Ireland will from April 2023 be subject to a new lower APD.
The changes mean that the cost of a BA business-class flight between Heathrow and Belfast will fall by £50.
This has angered the environmental group Communities Against Gatwick Noise and Emissions, which tweeted: ‘Rishi Sunak should be investing in trains, not removing passenger duty from domestic flights. It flies in face of [the] climate emergency.’
The Treasury revealed earlier this year it was considering raising taxes on flights to the furthest flung destinations to make the ‘polluter pay’.
APD is currently charged in two tax bands – for flights of up to 2,000 miles and for trips of more than 2,000 miles.
People on long-haul flights already pay £80 APD. Domestic flights are charged the short-haul rate of £26 for return travel. While APD is paid by airlines, much of the cost tends to be passed on to travellers.
Mr Sunak said: ‘Right now, people pay more for return flights within and between the four nations of the United Kingdom than they do when flying home from abroad.
‘We used to have a return-leg exemption for domestic flights but were required to remove it in 2001. But today I can announce that flights between airports in England, Scotland, Wales and Northern Ireland will from April 2023 be subject to a new lower rate of Air Passenger Duty.’
The changes mean that the cost of a BA business-class flight between Heathrow and Belfast will fall by £50
He added: ‘We’re also making changes to reduce carbon emissions from aviation. Most emissions come from international rather than domestic aviation.
‘So I’m introducing, from April 2023, a new ultra long haul band in air passenger duty – covering flights of over 5,500 miles, with an economy rate of £91. Less than 5 per cent of passengers will pay more, but those who fly furthest will pay the most.’
The Chancellor is punishing British citizens with family in far-flung destinations. London to Hong Kong, at 5,976 miles; or to Auckland, NZ, at 11,386, are among the worse affected by the new ultra long haul tax band
In response, Tim Aldersdale, chief executive of Airlines UK, said: ‘Reducing the rate of domestic Air Passenger Duty will correct an anomaly that has existed for too long and greatly enhance connectivity to and between all the regions of the UK, supporting route viability and enabling businesses and sectors across the economy to access markets, attract inward investment and support our tourism industry.
‘For many people and companies wanting to do business in the UK or see family and friends – particularly across Scotland and Northern Ireland – travelling by air remains the only viable option. This will make a tangible difference to their lives, providing more choice and frequency for consumers, and bringing all parts of the country closer together.’
Paul Charles, CEO of travel consultancy The PC Agency, said: ‘The Chancellor is punishing British citizens with family in far-flung destinations. London to Hong Kong, at 5,976 miles; or to Auckland, NZ, at 11,386, are among the worse affected by the new ultra long haul tax band. It would be better for the government to invest more in sustainable aviation fuel development so that airlines can fly on zero-emission fuel as soon as possible.
‘The APD cut for flying across the UK is a welcome move however and will help connect parts of the UK badly or unable to be served by train. It’s a boost for regional airports which can plan for further growth and renew investment programmes put on ice by the pandemic.’
Acting General Secretary of pilot’s union Balpa, Martin Chalk, issued fierce criticism of the Chancellor’s APD changes.
He said: ‘Whilst we welcome the reduction of domestic APD, the creation of a new band for longer-haul flying makes no sense. It will now be much harder to capitalise on our recent free trade deals with countries such as Australia and New Zealand and it also unfairly penalises those who need to travel over 5,500 miles to see family. This flies in the face of the Government’s Global Britain agenda.
‘With UK aviation only just being able to see the light at the end of the tunnel, this Budget provides no support for our once world leading aviation sector, and no recognition of the contribution we make to UK PLC.’