22 Jan

APD devolution: Impact on UK businesses and passengers

The announcement by the Government today that the power to levy Air Passenger Duty will be devolved to the Scottish Parliament may well result in reductions in the tax.

The Scottish Government has committed to cutting APD if it had the power to do so. Any future reductions in APD by the Scottish Government will be good news for passengers flying from Scotland and for Scottish airports and travel businesses; but this will come at a cost to the competitiveness of regional airports in the north of England, and to passengers elsewhere in the country who are already paying some of the highest flight taxes anywhere in the world. It is essential that rates of APD are consistent and competitive across the UK to ensure a fair playing field for businesses and fair rates for passengers.

We have issued a statement to the media today and made our views in Westminster clear that differing rates across the UK are unacceptable and that a cut in Scotland must be matched throughout the whole of the UK. APD is a damaging tax that puts the UK at a competitive disadvantage - whatever steps the Scottish Government take following today’s announcement, we urge the UK Government to take the initiative now and review the impact of this damaging tax.

On a separate note you may have read some reports in the trade press about changes to bank charges for debit card payments. Visa is changing its charges on 1 March in advance of an EU regulation, coming in later this year. The regulation will cap these costs but the move from a fixed rate to a percentage means that costs go up for higher value transactions. We will be updating our guidance notes to reflect the changes nearer the time. Individual merchant acquirers may in the interim alter the fees they charge you but if this is the case it  will be notified to you directly by your acquirer.

Mark Tanzer, Chief Executive