Mark Frary
Win VIP tickets
Last week, it was the announcement of increases in unregulated rail fares. This week, it is the plan to revise air passenger duty (APD) on a distance basis rather than replace it with a per-plane tax payable by airlines. Both will hit the business traveller - or their companies - hard in the pocket.
When Alistair Darling announced in the Pre-Budget Report last Monday that the government was shelving plans to introduce Aviation Duty on planes in place of the current Air Passenger Duty, there were murmurs of assent from around the House of Commons. Yet a quick look into the small print showed that, once again, business travellers would be expected to swallow increases that were much larger than anyone else.
Darling’s new plans for APD, which are due to come into effect from 1 November 2009, will see passengers charged in bands based on distance or, more accurately, on the distance between the capital cities of the cuontries they are travelling between. This thorws up some odd anomalies; travellers from the UK to the west coast of the US get away with paying less because Washington is on the east coast.
There will also be one rate for people travelling in economy class and another, higher rate for anyone else nuder the new rules.
Currently, the duty for long-haul business class passengers is £80. By November 2010, people travelling to destinations further than 6,000 miles away – such as Singapore and Sydney - will pay £170. This fee will be in addition to any fuel surcharges which remain in place despite the slump in the price of oil.
Once again, as we saw last week, it is business travellers who are expected to cough up for what is touted as a way of reducing the environmental impact of flying but in reality is no such thing. No matter that aviation is about to be included in the European Union’s Emissions Trading Scheme. In fact, aviation lobbying body BAR UK argues that the Department of Transport’s own statistics show that aviation’s contribution “already exceeds its environmental costs by over £100 million per annum”.
Business travellers and the companies that employ them are often seen as a cash cows by the government but if increases like these continue, those cows may soon be milked dry.
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