European budget carrier Ryanair is calling for the temporary suspension of the UK’s Air Passenger Duty (APD) tax. This appeal comes after the Transport Committee came out with a recommendation to temporarily suspend the APD as just one example of government action to benefit consumers during this difficult time.
What is Passenger Duty?
In short, the Air Passenger Duty is a tax imposed by the UK Government upon plane operators. This tax is often passed on to the passenger as a line item in the eTicket/Invoice but might also be simply included in the cost of airfare.
Airlines must register and pay Air Passenger Duty if they operate a fixed-wing plane from any UK airport that:
- weighs 5.7 tonnes or more
- is fuelled by kerosene
- carries passengers, whether they have paid for the flight or not
How much an airline pays depends on a few factors, including destination (i.e., distance from London), seat pitch, aircraft type (private vs. business jet), and class of travel (economy vs. business).
There are some types of passengers who are exempt from being calculated into the Air Passenger Duty. Some example exemptions are as follows:
- Children
- NATO flights
- Flight crews/cabin attendants
According to a BBC article, the APD costs £13 ($16.50) for a short-haul flight and £78 ($98) for long-haul in economy class. For first and business class passengers, the APD goes up to £26 ($33) for short-haul and £172 ($216) for long-haul.
Why the Transport Committee wants to suspend it
Suspending the APD tax is considered one way to lower airfare. By doing this, the Transport Committee believes it will stimulate the air travel market and economy, encouraging passengers to return to the skies once again.
As such, the Committee is also calling for a six-month suspension of the APD.
“It is imperative that the UK Government finds a way to get aviation back on its feet…Few industries have been affected more by the coronavirus pandemic than aviation.” -Huw Merriman, Conservative MP and chair of the Committee via iNews
Ryanair welcomes this measure and calls on the UK Government to adopt the recommendation. It is also calling for the government to end the “damaging (and useless) visitor quarantine” which has severely dampened and even killed tourism and economic activity across the UK.
Should the Government heed the recommendation?
For some airlines, depending on route networks and operating costs, the removal of the APD will significantly reduce airfares. For budget airlines like Ryanair, this could cut fares in half, or even more.
For other airlines who operate a more premium service, focused on long-haul journeys, there will also be savings. However, to the customer, this may not be as noticeable as it will be a smaller percentage of the airfare.
