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UK May Increase Air Passenger Duty

by Jason Gorringe, Tax-News.com, London

28 October 2003

UK Chancellor of the Exchequer, Gordon Brown is said to be considering an increase in Air Passenger Duty that will boost costs for flights departing from British airports.

The proposals are part of an investment plan that will see the addition of at least one new runway in the South of England in the coming years, and it is thought that Mr Brown is considering the tax hike in order to appease the green lobby.

At present, Air Passenger Duty in the UK ranges from £5 per passenger on economy class flights within Europe to £40 per passenger for club class flights on long haul flights departing from Britain. The airline industry is strongly opposing an increase in the tax, which currently raises £800 million per year for the Treasury, and the BAA (British Airports Authority) has called for its complete abolition.

Toby Nicholls, a spokesman for budget airline EasyJet, told the Independent that the passenger duty is “a blunt and unfair tax”, which hits the low-cost airlines particularly hard.

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