Air Passenger Duty
The question
To ask the Chancellor of the Exchequer, whether she has made an assessment of the potential impact of the air passenger duty rate increases for commercial airlines on the international competitiveness of UK hub airports relative to major European aviation hubs.
Answered by Dan Tomlinson
The Government is committed to the long-term future of the aviation sector and recognises the importance of maintaining a thriving and competitive aviation sector in the UK to deliver connectivity. The Government is clear that APD is an appropriate tax that ensures airlines make a fair contribution to the public finances, particularly given that tickets are VAT free and aviation fuel incurs no duty. Other countries also have different forms of aviation taxes.
Following previous changes to Air Passenger Duty (APD) rates to account for below inflation rates, at Budget 2025, the Government made the decision to uprate APD rates in line with RPI from 1 April 2027 and rounded to the nearest penny. This constitutes a real terms freeze.
The Chancellor makes decisions on tax policy at fiscal events in the context of public finances.
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