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FTO to challenge air passenger tax

(27 Feb 2007)

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The Federation of Tour Operators (FTO) has announced it is to challenge the legality of the government's decision to raise air passenger duty (APD).

If successful in its legal action, the FTO could see the complete withdrawal of tax, which has accounted for more than £2 billion in payments from air operators and holidaymakers.

Director general Andrew Cooper said: "This substantial legal action has been launched with great reluctance. APD - which since its introduction has raised some £12 billion - is a general tax and not one which is used to support transport or environmental initiatives."

He added as the tax is calculated on passenger numbers, environmentally-friendly airlines with fully-booked flights are rewarded ahead of half-empty planes.

The FTO argued that APD goes against the Chicago Convention on International Civil Aviation, which states the government cannot charge aircraft for the right to fly to and from the UK.

Meanwhile, the FTO also claimed APD is a breach of human rights as it deprives air operators of income they are legally owed from holidaymakers.

On February 1st, the government went ahead with moves to double APD.

Under the move, economy passengers flying from the UK to Europe are liable to pay £10 tax while long-haul flights have had their taxes increased to £40 in economy.

Chancellor Gordon Brown claimed the charge was raised as he believed airlines should pay more money due to the environmental damage they cause.

© Adfero Ltd