A change to the UK’s Air Passenger Duty tax on flying could be on the cards if the Labour Party win the next General Election, which is due to take place in 2024.
Speaking this week to the Airlines 2023 conference in London, shadow aviation minister Mike Kane MP said the current regime puts regional airports at a competitive disadvantage.
APD was originally brought in in 1994 as an excise duty on any air passengers departing the UK and alternative to directly taxing aviation fuel.
It has since gone through a number of rate changes including a double rate introduced for first class and business class passengers and a reduction on the most expensive long-haul routes.
Kane, who represents a constituency in the norther England city of Manchester where Manchester Airport is located, told delegates:
“I describe it as a watercooler tax that was intended to dampen demand at Heathrow, which means it was a real downer for regional airports in terms of growth.
“We have made changes to APD, and I am sure on the horizon we will look at it in terms of levelling up to allow our regional airports and airlines to compete.”
Kane said the aviation sector is “such a competitive environment” at the moment that regional airports are put at a disadvantage because of APD.
He called on the industry to work with government to make the UK a world leading green economy and said SAF (Sustainable Aviation Fuel) production could re-energise de-industrialised regions.
“Producing our own supplies of SAF could have a transformative impact on de-industrialised areas of the north.
“Labour is committed to creating a world-class green transport network no matter how you choose to travel.
“That’s what I will continue to work on with my colleagues in the Treasury team – how we can deliver that vision to make the UK the natural home for green aviation.”
With a target of 10% of aviation fuel being SAF by 2030, Kane said he did not want to put UK travellers at risk by to import it from abroad.
“We do not want to put UK passengers at risk by having to import fuel in a competitive market and in globally uncertain times that would push up prices for UK travellers.”
Kane said he was disappointed there was nothing in the recent King’s Speech, setting out the current Conservatives government priorities for the year ahead, for the aviation sector.
“I share your frustrations with this government and hope that they deliver some assurances to your industry in the Autumn Statement this week,” he said.
“I’m urging the current government to accelerate timescales in enhancing consumer rights and how to support SAF production to give the industry the confidence to thrive.”
Kane praised the aviation sector for the progress it has made since the 1950s in making each new generation of aircraft more fuel efficient.
And he said the sector was a vital provider of jobs. “Aviation produces well paid often trade unionised jobs.
“If we are to clean up in terms of the green agenda that the transition we want to see over this period if we have a Labour government.”