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Passengers wait with their luggage outside terminal 2 at London Heathrow Airport in London, UK, on Friday, Dec. 23, 2016.

Air passenger duty hike proposal upsets travel industry

Passengers wait with their luggage outside terminal 2 at London Heathrow Airport in London, UK, on Friday, Dec. 23, 2016.

Tourism interests and other lobby groups from the Caribbean have been pushing for adjustments in all air passenger duty (APD) applied to long-haul flights for years. Now it has come, but the turn of events is a rude awakening for travellers who love the Caribbean and for long-haul carriers who are fretting about the latest proposal from the British chancellor of the exchequer Rishi Sunak.

Sunak, in a budget presentation this week, proposed to cut by half the air passenger duty APD — which is a pollution tax — for flights between airports in England, Scotland, Wales and Northern Eire in 2023/24 , but also add £91 for ultra-long-haul flights of 5,500 miles or more.

Chancellor of the Exchequer Rishi Sunak

At present all flights over 2,000 miles (B and B) are charged at the same rate of APD: £82 in economy class, £180 for premium economy, business and first-class. These are set to increase to £84 and £185, respectively, from April 2022. The chancellor stressed that the proposed move will assist the UK authorities obtain its carbon emissions discount targets.

Caribbean tourism interests, for over a decade, have been trying to convince authorities to reverse the increases on long-haul economy flights. Now they have gone higher as the chancellor seeks to convince Brits to take holidays closer to home.

The pushback has been immediate. In response to the move by the chancellor of the exchequer in the United Kingdom, Willie Walsh, director general of the International Air Transport Association (IATA), on October 27, stated: “Masquerading this cash grab as a green tax the week before COP26 is the height of political hypocrisy that people are fed up with.”

Willie Walsh, director general of the International Air Transport Association (File photo)

He fumed, “Just two weeks ago the global airline sector committed to achieving net-zero carbon emissions by 2050. The aim is to keep flying both affordable and make it sustainable. A tax hike does not help. We know that none of the billions of pounds collected will be directed to green investments.”

He added, “Moreover, placing an even larger APD financial barrier between the UK and the world makes a mockery of the global Britain ambition by dealing yet another blow to the UK’s competitiveness. The reduction in domestic APD tells us that the Government understands the economic destruction that APD causes. It should apply this wisdom to international connectivity and aim to boost UK competitiveness by eliminating APD completely.”

The Jamaica Observer reached out to local tourism interests who expressed the opinion that they doubted that Jamaica would be affected.

Minister of Tourism Edmund Bartlett said Jamaica, being 4,561 miles from London, the UK capital, remains outside of the new 5,500 tax band. Other regional destinations which fall outside of the 5,500-mile radius will be affected.

Jamaica’s Minister of Tourism, Edmund Bartlett, addresses a digital press conference on April 17, 2020. (File photo)

Long-haul carriers have criticised the chancellor’s decision to increase air passenger duty rates for flights longer than 5,500 miles.

Luis Gallego, chief executive at British Airways’ parent company IAG, was quoted as saying the move “will penalise global Britain” at a time when the country should be more competitive on the global stage.