It has taken a while to gather data but the UK tourism industry has at last been able to produce research which confirms what Cheapflights and the aviation industry has been warning the Government about for several years, writes John Barrington-Carver.
Air Passenger Duty is too high, it is deterring travel to and from the UK and is costing as much if not more than it raises.
The Tourism Alliance reports today that its research shows that the unpopular duty on all flights leaving the UK has actually cost UK tourism alone £1 billion annually. This supports the “Axe the Tax” alliance of four normally competing airlines that stated last week that the duty has cost the UK economy more than it raised. This certainly echoes the Dutch Government’s experience where their brief version of air passenger tax lasted just a year and cost their economy four times more than it raised.
A survey by the Association of British Travel Agents (ABTA) of 2,000 people found that nearly 70 per cent think they already pay too much tax when they fly from the UK.
The research also shows the public is becoming increasingly aware of the levels of tax they pay, with 65 per cent of customers paying close attention to the amount of tax on their tickets, compared to 58 per cent in 2010.
The ABTA research suggests that with APD being the highest such duty in the world that the 10 per cent rise in APD anticipated in April 2012 would prove counterproductive. Certainly the research goes on to show that 43 per cent in their poll say higher taxes would put them off flying. There are precedents showing that raising a tax when there is an option to avoid it, i.e. either not travelling or doing so from a European airport could mean the Government may actually lose income. Indeed the Treasury already admitted earlier this year that they expected to have half-a-billion-pound shortfall from expected revenues from APD.
Mark Tanzer ABTA’s chief executive, said: “For too long successive governments have relied on public ignorance of APD to steadily increase this damaging tax to the highest levels in the world.”
The call to “Axe the Tax” was first made by Cheapflights in early 2008 and has now been taken up as a slogan by a powerful group of airlines. Lets hope that since the Government has named UK Tourism as one of the bastions of the economic recovery, now the industry itself has shown the damage that APD is doing to Tourism, that the Treasury might agree, if not to Axe the Tax, then at least to chop it down to a sustainable size.
(Image: whatleydude)
