Jeremy Hunt hikes aviation tax in Budget - what it means for your holidays
The Government is hiking tax on flights - but only for those not in the cheap seats.
In his Budget today Chancellor Jeremy Hunt announced the rate of tax paid on "non-economy flights" would be increased, although he did not say by how much. Those details are likely to be released by the Government later today.
"I will make a one-off adjustment to rates of Air Passenger Duty (APD) on non-economy flights only to account for high inflation in recent years," Mr Hunt told the House of Commons.
For those heading on holiday in budget airlines such as Ryanair, easyJet and Wizz Air, the amount of APD paid in each fare will not increase.
There are three rate bands for APD: a reduced rate for economy, standard for business class seats, and a higher level for private jets. Business class passengers pay from £13 for domestic flights up to £200 on the longest international journeys. A small rate increase for business class travel from 1 April had already been announced. It will push up the tax to £14 on domestic flights and £202 on the longest international flights. It remains to be seen whether that rise will be increased further. Currently, APD raises a total of £3.8 billion a year for the Treasury.
Pampered pooches on UK's first private jets for pets airline ready for take-off
(Getty Images/iStockphoto)UK Policy Manager of Transport and Environment UK, Matt Finch, said: "The aviation sector is massively undertaxed, and this long overdue change, that will come into effect in 2025, is the tax equivalent to rearranging the deck chairs on the Titanic.
"It's baffling that the Chancellor didn't do this years ago. But it's still completely unbelievable that airlines don't pay a penny in fuel duty when you and I have to pay every time we fill our car up. Where's the fairness in that?"
The move comes almost a year after domestic APD was slashed in half on the orders of former Chancellor Rishi Sunak, in a bid to get the UK's aviation industry up and running again after the coronavirus lockdowns. Airlines including Ryanair and easyJet pushed hard for the cut - which saw the rate drop 50% to £6.50 from April 1 last year.
During consultation into those proposals, rail industry insiders warned that the change could lead to 27,000 tonnes of emissions extra being released and 220,000 fewer rail journeys in the UK a year as people swap expensive trains for cheaper planes.
Analysis by The Mirror and the Aviation Environment Federation (AEF) last year showed that extra routes introduced by one airline alone - which were directly linked to the cut - will dump more than 9,000 tonnes of CO2 into the atmosphere each year.
Cutting aviation tax is controversial as flying is one of the most environmentally unfriendly ways to travel and is primarily done by those at the upper end of the income scale. Environmental campaigners have long pushed for higher APD and more investment in rail travel, which is far greener per passenger mile.
Just a month after UK domestic aviation tax was halved, in France routes where the same journey could be made by train in under two-and-a-half hours were banned, in a bid to get more people on trains and off planes.
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