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NEWS Last modified on December 10, 2014

Scotland's largest airports call for swift action on APD

Scotland’s largest airports have called on the UK government to “act swiftly” on recommendations made by the Smith Commission and devolve air passenger duty (APD) as soon as possible.

The leaders of Aberdeen, Edinburgh and Glasgow airports have written to the leaders of the Westminster parties urging them to make an early commitment to deliver on the financial powers recommended by the commission and ensure the Scottish Parliament receives the new powers it was promised.

The letter states by harnessing the opportunity presented and devolving APD to Scotland, the government will deliver a “tremendous boost to Scotland’s tourism industry and its economy as a whole.”

APD is the highest air passenger tax in the world, and the gateways say in addition to costing Scotland over two million passengers per annum, a 2012 report commissioned by the airports, warned by 2016 APD will cost the Scottish economy up to £210 million (€266 million) in lost tourism spend per annum.

The letter also addresses the concerns expressed by airports in the north of England who believe they will be placed at a competitive disadvantage.

The airports state: “We are aware of and understand the concerns which have been raised by our counterparts in England regarding APD, however, we believe that any tax competition across the border would be minimal and is not in itself a good reason to prevent the devolution of the tax to Holyrood.

Edinburgh

“In almost all cases, Scottish airports do not compete substantially with airports in the north of England for flights – our most energetic competition is in Europe where there is no tax at all.

“What is more, APD is a self-contained tax and does not interact with the rest of the fiscal system. This makes it inherently suitable for devolution as the partial, trouble free devolution to the Northern Ireland Assembly has shown.”

APD is an excise duty, which is levied on the carriage of chargeable passengers from a UK airport on chargeable aircraft. 

The government has significantly increased rates and restructured APD since 2007 with rates for short-haul travel increasing by around 160% with long-haul rates increasing between 225% and 360%.

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