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INSIDE TRACK: Flights boon is just a dream without a Yes vote

IN an independent Scotland, we will enjoy cheaper foreign holidays, better business connections and a host of direct long-haul flights to economically important destinations, particularly in North America and the Asia Pacific region.

At least, this is the future of Scottish air travel laid out in the White Paper. The vision will be funded first by slashing the prohibitive air passenger duty (APD) tax by 50% before scrapping it altogether "when public finances allow".

The proposals come as no surprise given the Scottish Government's long-standing demands for Westminster to control over devolve APD north of the Border - and Westminster's consistent refusal to do so. Their rancour will only have been stoked by Chancellor George Osborne's announcement last week that the tax will be hiked up again next year, for the sixth time in as many years, despite pleas by the airline industry and tour operators for a freeze or cut instead.

As of April 1, 2014, the cost per passenger of medium and long-haul flights - exactly the type the Scottish Government would most like to attract - will increase by 2.4% to 3%. That means anyone flying from the UK to North America will pay £69 in APD, or £85 for destinations such as India, Thailand or the Caribbean. A ticket to far-flung hotspots in Australia or South America will come with £97 in APD attached.

Passengers may or may not see the actual cost of flying increase - it depends how much the airlines can afford to absorb themselves in a bid to remain competitive - but Scotland's airport bosses regularly complain that the net result either way is that airlines are reluctant to launch new routes, especially from regional hubs.

A report by think-tank York Aviation has estimated APD would to cost Scotland more than £200 million a year in lost tourism spend alone by 2016, while accountants PwC forecast earlier this year that scrapping it would boost UK revenue by around £250m a year through increased business trade.

But opponents - especially environmentalists - claim the aviation industry already costs taxpayers £11 billion annually because it pays no VAT or tax on jet fuel.

The White Paper makes the point that "connecting Scotland with the world will never be a top priority with the Westminster Government, with its focus on the transport needs of London and the south-east". Plans for HS2 have probably underlined that for many people.

But could Scotland attract the routes it most desires under independence? The White Paper holds up examples such as Ireland and Denmark, but neither country operates direct flights to the Far East and between them only two to the US west coast - to Los Angeles and San Francisco.

On the other hand, perhaps the APD dream could spark a much-needed renaissance for Prestwick Airport - once Scotland's only long-haul airport and still the only one with a rail link and runways capable of accommodating superjumbos.

Either way, it seems unlikely Holyrood will ever get the chance to axe APD without a Yes vote.

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