Scotland tax change may divert flights from England

Scottish airports may get advantage over English rivals

Scottish airports are likely to get an advantage over rivals in England if, as expected, Scotland cuts taxes on passengers flying out of the country from 2015.

The UK government has promised a range of new powers over taxation to the Scottish Parliament, including control over the UK’s controversial air passenger duty (APD). Scotland would then be able to cut or even scrap the tax north of the border.

Britain’s APD is a tax of between £13 (€16.40) and £194, depending on flight distance and class of travel. This is charged on each passenger leaving the country.

So a change to the tax could make flying out of Scotland much cheaper for passengers and for airlines, which have had to raise fares because of the tax. Airlines welcomed the agreement between UK and Scottish governments.

“Removing Scottish APD would see passengers rushing across the border to avoid paying the punitive tax at Newcastle, Manchester or any other English airport,” opined Willie Walsh, chief executive of IAG, which owns British Airways, Iberia and Vueling. “Who could blame them – a family of four flying to the US would save £276 in APD by heading north.”

Getting rid of APD could also boost tourism in Scotland by £200 million a year, according to IAG, which has long been a fierce critic of the tax.

Reuters

[pictured: St Andrews Castle, Fife; photo courtesy VisitScotland]


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