The aviation sector remains very lightly taxed. Exempt from both fuel duty and VAT, Air Passenger Duty was introduced as a way of ensuring that the sector makes some contribution to the public purse.
APD has never been high enough or smart enough to fully address the sector’s environmental impacts, and it was never designed as an environmental tax. But removing or reducing it – as is periodically called for by the industry – would increase the scale of the existing environmental problems that the sector presents, and would make no sense unless the Government was to put in place new policies (or taxes) to tackle these problems.
With the Autumn budget statement out on Wednesday 23rd November, we’ve put together a new briefing setting out The case for APD.