Industry | 2009.09.09
Government pegs flight taxes – for now
Lord Adonis defends third Heathrow runway and rejects additional levy to dissuade passengers from air travel
The transport secretary, Lord Adonis, today ruled out immediate tax rises for airline passengers despite calls from the government\'s advisory body on climate change for radical cuts in aviation industry emissions.
Adonis said forthcoming increases in air passenger duty (APD) would cover British aviation\'s contribution to global warming, but admitted future increases could not be ruled out because they would be kept under review by the Treasury.
The transport secretary also defended the decision to allow a third runway at Heathrow, which faces a challenge from the committee on climate change.
"The changes we are making to air passenger duty are to ensure that aviation does pay its fair share of taxes, against its cost to the environment," Adonis said.
Asked whether the government was prepared to raise flight taxes following a warning from the committee that demand for air trips might have to be constrained, he said: "We have no plans other than those announced by the chancellor.
"But these will be kept under review as part of the Treasury\'s normal budget process."
In November air passenger duty will rise from £10 to £11 for a short-haul flight, increasing again – to £12 – next year.
The tax on economy class flights to the US will rise from £40 to £45 in the autumn and be set at £60 by 2010.
Routes longer than 6,000 miles, such as London to Buenos Aires or Sydney, will carry a levy of £55 for an economy-class flight, rising to £85 next year.
APD raises £1.9bn a year for the Treasury. The government is under pressure from the green lobby to increase aviation taxes since pledging to reduce UK flights\' carbon emissions to 2005 levels by 2050.
The policy was announced this year alongside approval for Heathrow expansion, attracting criticism from environmental campaigners, who said accommodating a near-doubling of air traffic over the next 20 years was incompatible with achieving an 80% reduction in Britain\'s carbon dioxide emissions by 2050.
The committee on climate change has indicated demand for air travel would have to be curbed in the decades to come because unchecked airline growth would see aviation account for a quarter of emissions by developing countries by 2050.
Its chief executive, David Kennedy, said the Heathrow decision could be considered by a review of UK aviation and its impact on climate change, due in December.
Speaking outside a high-speed rail conference in London, Adonis defended the government\'s Heathrow policy, saying the 2050 target could still be met even if a third runway increased the number of flights to and from the UK.
"There is no incompatibility whatsoever between the committee on climate change report and a third runway at Heathrow," he said.
"The statement of policy which [the former transport secretary] Geoff Hoon made on 15 January included the 2050 target for aviation emissions to be lower than 2005."
Transport is the second largest emitter in the UK behind the energy industry, accounting for 21% of domestic greenhouse gas emissions. Domestic aviation accounts for about 1.6% of the total within that transport segment.
Adonis told the Guardian this year that he expected high-speed rail to replace domestic air travel, with 46 million domestic air passengers a year choosing the 250mph train network instead.
Aviation enters the EU carbon trading scheme in 2012, and airlines argue that the cap-and-trade programme will cover its contribution to global warming.
Adonis today backed the expansion of the scheme to international flights, saying "aviation should be treated as an international sector in its own right".
According to one industry estimate, the average passenger could pay an extra £10 a return ticket under the scheme.
Aware that pressure is building on their industry, leading airlines are now campaigning for a global airline trading scheme.
Airlines could contribute $5bn (£3bn) a year to help developing countries fight climate change if such a scheme went ahead, according to the Aviation Global Deal Group, whose members include BA, Virgin and Air France-KLM.
For more information, please visit
http://www.guardian.co.uk/world/2009/sep/09/flights-airline-fares-taxes
