Air Passenger Duty (APD) is an excise duty which is charged on the carriage of passengers flying from a United Kingdom airport on an aircraft that has an authorised take off weight of more than ten tonnes or more than twenty seats for passengers. The duty is not payable by inbound international passengers who are booked[1] to continue their journey (to an international destination) within 24 hours of their scheduled time of arrival in the UK. (The same exemption applies to booked onward domestic flights, but the time limits are shorter and more complex.) If a passenger "stops-over" for more than 24 hours (or the domestic limit, if applicable), duty is payable in full.
As part of the 2008 Pre-Budget Report, Air Passenger Duty was restructured.[2] These new charges take distance into account, making long distance flying significantly more expensive. Critics[3] of APD's claimed environmental credentials point out that the tax takes no account of the efficiency of the aircraft. An airline using an old inefficient plane is treated equally to one using the latest most efficient engines. Charges initially rose on November 1, 2009 and then again on November 1, 2010. Before this, Air Passenger Duty was controversially[4] doubled[5] from February 1, 2007, and the lower rate was extended to all the countries within the Single European Sky. This table summarises the changes:
| Old Rate | Previous rate | Feb 2007 - Oct 2009 |
|---|---|---|
| European destinations, lowest class | £5.00 | £10.00 |
| European destinations, other classes | £10.00 | £20.00 |
| Other destinations, lowest class | £20.00 | £40.00 |
| Other destinations, other classes | £40.00 | £80.00 |
Here, 'European destinations' includes countries in the European Economic Area and certain other European countries.
The distance used to calculate the new rate of APD is the distance between London and the capital city of the destination country as summarised below:
| New Rate | Nov 2009 - Oct 2010 (lowest) | Nov 2010 - Mar 2012 (lowest) | Nov 2009 - Oct 2010 (other) | Nov 2010 - Mar 2012 (other) | Apr 2012 onwards (other) |
|---|---|---|---|---|---|
| Band A (0 – 2000 miles) | £11.00 | £12.00 | £22.00 | £24.00 | £26.00 |
| Band B (2001 – 4000 miles) | £45.00 | £60.00 | £90.00 | £120.00 | £130.00 |
| Band C (4001 – 6000 miles) | £50.00 | £75.00 | £100.00 | £150.00 | £162.00 |
| Band D (over 6000 miles) | £55.00 | £85.00 | £110.00 | £170.00 | £184.00 |
The Treasury forecast the 2007 rise will cut carbon dioxide emissions by about 0.3 million tonnes a year by 2010-2011, and all greenhouse gas emissions by the equivalent of 0.75 million tonnes of carbon dioxide a year,[6] although that has been disputed.[7]
As air passenger duty is paid upon booking, but not collected until an occupied seat flies, should a passenger be unable to fly they have a right to claim the paid tax back from the airline, although many airlines will charge an administrative fee for this service. [4]
The tourist minister of Kenya, Najib Balala, criticised the Air Passenger Duty for hurting tourism and economy in developing countries.[8]
From November 1, 2011 Northern Ireland will be exempt from the higher rates of Air Passenger Duty this is due to Continental Airlines threatening to stop the direct Belfast - Newark flight due to lack of demand because of the tax. http://www.bbc.co.uk/news/uk-northern-ireland-15072772]
The Chancellors Autumn Statement, on the 29th November 2011, announced a near 10% increase in UK APD set for April 2012. Approximately 6.5 million people that have scheduled flights for after April 2012 will be forced to pay up to 10% more for the tax on their already paid for flights. [9] The UK already has the highest Air Passenger Duty in the world and has already cost 25,000 UK travel industry jobs. [10]