APD costing UK more than 60 airline routes

A report by Frontier Economics, commissioned by Airlines UK, has identified 66 routes that would become more viable if they no longer incurred APD charges. Airlines UK represents 13 major UK-based airlines.

These routes include 20 domestic UK services, 31 short-haul connections and 15 long-haul flights outside London area airports.

Potential long-haul routes include services to Dubai from Aberdeen, Edinburgh and Bristol, and flights to Delhi from both Edinburgh and Manchester.

Short-haul international routes include eight new destinations from Aberdeen, nine from Belfast, seven from Southampton as well as new routes from Glasgow, Liverpool, Newcastle and Nottingham.

Among the potential new domestic routes identified in the report are Liverpool to Southampton, Bristol to Leeds Bradford and Edinburgh to Guernsey.

The report said APD had pushed up ticket prices for passengers, which had dampened demand for some routes and made them unviable.

Tim Alderslade, Airlines UK’s chief executive, said: “As we prepare to leave the European Union we should be doing everything in our power to create the conditions for economic success – and as an island nation it is hard to see how levying the highest rate of tax on air travel in the world is compatible with this goal.

“The costs of such a counterproductive policy are there for all to see – with dozens of potential services, including long-haul connections outside of London, proving unviable under current conditions, putting a brake on the UK’s economic growth.

“The message from this report is clear – get rid of this damaging tax once and for all and carriers will be in a position to respond in kind with more routes, greater frequency and better connectivity for the whole of the UK.”

The government raised £3.4 billion from APD in 2017 and this is forecast to rise to more than £4 billion by the 2022-23 financial year.

The report also found that APD represents as much as 50% of the price of an off-peak short-haul airfare from UK to Poland, while on flights to Israel, which fall into the more expensive band B of charges, APD accounts for around 29% of average airfares rising to 44% in off-peak periods.

Band A applies to destinations where the capital city is 2,000 miles or less from London, while band B applies to destinations with capitals more than 2,000 miles from London.

Several destinations in the Middle East, including Israel, Egypt and Jordan, which just fall into band B have been lobbying the UK government to be rezoned into band A.