New chancellor may scrap APD reform, sources claim

New chancellor Rishi Sunak is reported to be against an overhaul of Air Passenger Duty – something that could affect Flybe’s future.

The Telegraph reports that Sunak’s predecessor Sajid Javid had backed a reduction in APD in next month’s Budget to help keep Flybe from administration.

However, Javid’s successor is thought to be against a cut in the tax, charged at £13 per one-way domestic flight, which puts the airline at a price disadvantage compared to alternative means of transport.

The Telegraph quoted a source saying: “Don’t bank on it happening.”

Flybe’s owners, which include Virgin – itself 49% owned by Delta, which made $6.2 billion last year – have sought a £100 million bridging loan from the government to bolster Flybe’s finances.

They have warned that a cut in APD is essential for Flybe’s future prosperity.