A lucky escape for private jet users: Air Passenger Duty (APD) is here to stay
The UK private jet industry was saved last week from a radical change to air passenger tax regulations, that would have resulted in substantial price increases for private jet travellers. The UK government has abandoned last year’s coalition agreement to scrap the current Air Passenger Duty (APD) and replace it with a per-plane tax.
The current tax is added to each ticket sale on a per seat basis. The amount depends on the class of ticket and the distance flown : e.g. £12 for a short haul economy ticket or up to £170 for a 1st class ticket to Australia.
Exemptions to the current APD include private aviation and cargo flights plus passengers flying on a connecting flight (so a passenger flying from Edinburgh to London then catching a connecting flight to New York would only pay APD on the 2nd flight).
The proposed ‘per plane’ tax would have been applied to an aircraft’s maximum takeoff weight – and would not have been proportionate to the number of passengers on-board. It would have benefitted passengers travelling by low cost airlines with high load factors such as easyJet and Ryanair, who would have paid lower fares. However passengers travelling on aircraft with large business and first class sections would have ended up paying more tax than the current system. Passengers travelling to connect with long haul flights would also have been liable to pay their share of the aircraft’s overall flight tax bill; British Airways for example would have seen a massive increase in operating tax that would have been passed onto their passengers.
But private aviation users are the passenger group with the biggest reason to celebrate this tax turnaround: With the average number of passengers on a private jet being only 2.8, the increase in taxation per passenger would have been substantial. The private jet industry, still battling out of the last few years of recession, can breathe a collective sigh of relief this week after avoiding an airborne collision with the tax man.
Related content
Air Passenger Duty on private jet flights
3 flights & prices in June: Combining airlines & private flights
