Tuesday, 22 June 2010

UK Budget: Aviation impact

Well the new UK Budget has been announced and two things stand out of interest (well there are quite a few things, but lets concentrate on the aviation side)

VAT will be rising to 20% from 4th January 2012 - For those of you in the EU, we're coming up to the same levels as you. For non EU, its time to get those claim dockets ready when you leave the country to get more tax back.

More interestingly, to quote
"The government will "explore changes to the aviation tax system" such as switching from a per-passenger to a per-plane levy. It will consult on major changes.
In other words, Air Passenger Duty could be on the way out, and replaced with something different. However, it's important to note no announcement was regarding the last governments plans to increase Air Passenger Duty in November - in other words, take it as read those new rates from November 2010 will be implemented alas.

As a reminder, the new Air Passenger Duty Rates are (Ticketing Code element UB) based on bands:

Band A 0–2,000 miles from London 
Band B 2,001–4,000 miles from London 
Band C 4,001–6,000 miles from London 
Band D over 6,000 miles from London 

Rates of duty for 2009-10 and 2010-11 are as follows:

Band 
Reduced Rate Standard Rate 
2009-10 2010-11 2009-10 2010-11 
Band A £11£12£22£24
Band B  £45£60£90£120
Band C £50 £75£100£150
Band D £55 £85£110£170

To decode what band your country is in, head to the lovely guide published by Her Majesty's Customs and Excise at www.hmrc.gov.uk/pbr2008/pbrn20.pdf

And a reminder. Taxes normally head only one way normally....

2 comments:

  1. Would prefer to see a revision of APD rather than a "per-plane" levy, with alterations to all four bands to eliminate most, if not all, of the anomalies of the tax.

    Something on the lines of:
    Band A 0–2,300 miles from London
    Band B 2,301–4,700 miles from London
    Band C 4,701–7,000 miles from London
    Band D over 7,000 miles from London

    With Emissions Trading in the EU coming in after 2012 airlines will come under pressure to operate their planes as close to full capacity as possible and APD can be gradually phased out.

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  2. Band A - Egypt and Israel
    Band B - USA/all of Caribbean except the Cayman Islands
    Band C - medium-long haul destinations inc. Malaysia
    Band D - Indonesia/Australia/New Zealand/Fiji

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