The head of Scotland's busiest airport has stepped up his attack on the UK's air passenger duty (APD) regime, claiming that the benefits to the Republic of Ireland of scrapping the tax highlighted the "stupidity" of continuing to apply it to Scotland.
In an online article for the Sunday Herald, Edinburgh Airport chief executive Gordon Dewar argues that Dublin's decision last month to abolish APD from April 2014 had already had "immediate" benefits, including Ryanair's plan to operate eight new services from Shannon Airport.
He writes: "Our friends in the Treasury and Coalition politicians repeatedly ask for evidence of airlines making decisions because of APD. [Ryanair founder Michael] O'Leary has shown that airlines will come if APD goes. It's as simple as that. The Airport Operators Association predicts these new Ryanair flights will boost Shannon's passenger growth by 15%."
In an interview, Dewar said that APD, instigated as a specific measure to mitigate the costs of airline emissions, had become "just a general tax", which was not being ring-fenced for green restitution measures.
He said: "The airline industry is already part of a carbon trading scheme that more than compensates for emissions … This duplicative and non-allocated tax on top is stupid in that it costs more in lost revenues than it brings in."
In February, a report from consultants PricewaterhouseCoopers (PwC) commissioned by British Airways, easyJet, Ryanair and Virgin Atlantic showed that UK APD was the highest tax of its type in the world.
The Scottish Government has repeatedly advocated devolving power over APD to the Scottish Parliament and reducing the rate, a move backed by the Scottish Chambers of Commerce and other business groups. In a speech in April, First Minister Alex Salmond said: "There is an overwhelming consensus that the current air passenger duty regime in the UK is hurting our economy by discouraging the establishment of direct air routes into Scotland's airports.
"PwC suggested its abolition would boost exports by 5% in total over the next three years, increase the UK's GDP by £5 billion a year, and create approximately 60,000 jobs."
The Dublin government is scrapping APD on all flights from next April, having already cut it to a flat fee of €3 (£2.50).
Current UK APD ranges from £12 for economy class short flights to £376 for first class long-haul flights.
Devolution of APD to Northern Ireland resulted in the cutting of the tax on long-haul flights in January.
To read Gordon Dewar's article, see www.heraldscotland.com/business
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