Yesterday’s release of the Smith Settlement for Scotland devolves responsibility for Air Passenger Duty to the Scottish Parliament, which has previously stated that it will immediately halve this tax and look to abolish it in the future.
The Tourism Alliance, of which the RDO UK Chapter is a member, has stated in a press release issued today that it views APD as a tax on the country’s export earnings and therefore welcomes the Scottish Parliament’s approach. However, it has warned Westminster that APD needs to be cut for English and Welsh airports to avoid distorting the tourism market and rendering the recently announced £10m fund to attract overseas visitors to Northern England useless.
When the Irish Government reduced APD, residents from Northern Ireland crossed the border in order to get cheaper flights out of Dublin. This threatened the viability of many routes into Belfast, caused the UK government to lower APD for Northern Ireland in order not to wreck the Northern Ireland tourism economy.
Ufi Ibrahim, Tourism Alliance Chairman, stated, “It would be perverse for the Government to allocate £10m to the new Northern Fund with the aim of bringing more international tourists to Northern England when the devolution of APD to the Scottish Parliament makes Northern England’s airports uncompetitive and they have to close down international routes.”
The tourism industry has been at the forefront of the UK’s economic recovery, having created a third of all new jobs over the last three years. The reason that the Scottish Parliament is lowering APD is because it recognises the benefits that the industry delivers. If we are to provide those benefits throughout the UK, APD must be the same throughout the UK.