Four major airlines on Monday called on the government to use next week's annual budget to scrap plans to hike air passenger duty (APD), in an effort to boost economic growth and preserve jobs.
The chief executives of easyJet, BA parent International Airlines Group (IAG), Ryanair and Virgin Atlantic appealed in a joint statement for finance minister George Osborne not to follow through with a plan to raise the duty by eight percent from April 1, 2012.
Chancellor of the Exchequer Osborne will unveil the coalition government's annual budget statement before parliament on March 21.
"We call on the chancellor to suspend the April 1 rises in APD, and those planned up to 2016, while the Treasury commissions an independent study of the economic effects of this job-destroying tax," said the statement from easyJet chief executive officer Carolyn McCall, IAG CEO Willie Walsh, Ryanair boss Michael O'Leary and Virgin Atlantic head Steve Ridgway.
"We are confident such a study would show that APD's damage to economic activity outweighs the revenue obtained. It is irresponsible of the Treasury, if it is serious about pursuing economic growth, to keep piling on APD increases without conducting a study of this kind."
A Treasury spokesman said: "The government took action by freezing Air Passenger Duty last year and has always been clear that APD would go up this April."
"As announced at the Autumn statement, we are also extending APD to private business jets for the first time.
"It is also worth noting that, unlike some other European countries, the UK does not levy VAT (sales tax) on domestic flights and aviation fuel is not taxed. The aviation industry will also benefit from the cut in corporation tax."
Source: AFP European Edition
