Further calls for APD devolution

10 October 2011

A group of leading North-east business and public sector figures have written an open letter to the Chancellor – calling for immediate action to be taken on Air Passenger Duty.

In advance of his pre-budget report, due in November, the group hope that their eleventh hour bid will help reverse the crippling taxes.

It follows an announcement in late September that APD for long haul routes in Northern Ireland were to be reduced to short haul levels, in order to help stimulate the economy.

The letter (attached) notes that there are many similarities between the economic context for Northern Ireland and Scotland. Scotland is trying to increase inward investment and increase export revenue to support an economy recovering from the economic recession.

In the circumstances, the group suggest that many of the arguments that apply to the relationship between rates of APD and the development of business and tourism in Northern Ireland apply equally to the more peripheral regions of the UK, including the North East of Scotland.

Derek Provan, Airport Managing Director said “Earlier this year, we as a group asked the Chancellor to consider devolving APD to the Scottish Government. Ministers in Scotland have been supportive of this proposal, and we have sought confirmation from them that should it be devolved the monies raised would be used for the long-term good of the aviation industry in Scotland.  This announcement about changes to the system in Northern Ireland make it increasingly difficult to ignore our argument.”

Derick Murray, director of North east transport body NESTRANS said: “An economic impact study, carried out for the Scottish Airports, into Air Passenger Duty clearly shows the relationship between this tax and passenger numbers. For the North East, because of our geography and global economy a very high proportion of passengers are businesses and this tax effectively taxes our businesses disproportionately. Devolution to the Scottish Parliament, as proposed for Northern Ireland would permit taxes to be set that don’t penalise our companies.”

-ENDS-