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UK Confirms New Air Passenger Duty Structure

by Jason Gorringe, Tax-News.com, London

20 February 2015


The UK tax authority, HM Revenue and Customs (HMRC), has released an information brief on plans to substantially reform the structure of the UK's air passenger duty (APD) from April 1, 2015.

As announced in the 2014 Budget, the number of APD destination bands will be reduced to two by merging the three bands for medium and long distance flights, bands B, C, and D. The higher rates that apply to aircraft with an authorized take-off weight of 20 tonnes or more and with fewer than 19 seats – aimed at business jet travel – will be set at six times the reduced rates.

From April 1, 2015, band A (for flights of up to 2,000 miles) will feature a GBP13 (USD20) charge for economy class; GBP26 for all classes other than economy class; and a higher rate (for business jets) of GBP78.

The second band, Band B, which applies to flights of over 2,000 miles will be levied at a rate of GB71 for economy class and GBP142 for other classes. The higher rate will be GBP426.

According to Government estimates, the changes will reduce the APD tax burden by over GBP200m each year, beginning with a fall of GBP215m in the fiscal year 2015-16.

The measure will reduce the tax paid on flights to many destinations. A family of four visiting relatives in the Caribbean or India flying in economy class will pay GBP56 less APD. A person flying business class to China or Brazil will pay GBP28 less.

TAGS: individuals | environment | Wealth | tax | business | air passenger duty (APD) | aviation | United Kingdom | environmental tax | tax authority | professionals | tax rates | HM Revenue and Customs (HMRC) | tax reform | HM Revenue and Customs (HMRC)

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