Airline bosses have reacted angrily to the pre-Budget statement which was delivered by Chancellor Alistair Darling last week. With Air Passenger Duty (APD) set to rise, there are fears that some airlines may have to cut down on the number of flights operating out of Liverpool John Lennon Airport.
With the nation’s economy struggling, the spotlight was on the Chancellor as he announced a series of measures which he hopes will kick-start the economy. While the headlines were made by the VAT rate cut, Michael Cawley, the Chief Operating Officer of budget airline Ryanair has tried to draw attention to the rising taxes which are to be imposed on air passengers.
APD is set to rise by 10% in 2009 from £10 to £11 for short-haul flights with a further increase to £12 expected in 2010. In a statement released in the aftermath of the pre-Budget statement, Cawley said that he expected this rate to affect regional airports such as Liverpool to a greater extent than the country’s larger airports.
Cawley went on to argue that “passenger traffic has fallen since this tax was introduced and this increase will have a further damaging effect on passengers.” Airlines fear that rising prices will reduce consumer demand for flights which may in turn force a reduction in the number of flights provided from some airports.
With air travel often cited as a significant contributor to the production of carbon emissions, taxes such as APD are applauded by environmental organisations. In their statement, however, Ryanair slam the so called ‘environmental tax’, arguing that the revenue which is generated is not being used to address environmental issues.
In this time of economic hardship, Liverpool John Lennon Airport passengers may be one group which finds themselves disappointed by the UK Government’s new taxing plans.