UK Air Passenger Duty hike disappointing - PM

Prime Minister John Key today expressed his disappointment at the British Government’s announcement overnight of an increase in passenger duty for air travellers to New Zealand.

The British Government has announced that the UK Air Passenger Duty (APD) will increase next April from 85 pounds sterling to 92 pounds sterling per passenger coming to New Zealand.

“The APD places a significant burden on New Zealand businesses, on families who travel, and on our tourism industry,” said Mr Key.

“The British Government has been reviewing the structure of the APD this year and the New Zealand Government has been talking closely with them about this issue. We made our views on APD clear on several occasions, including during Foreign Minister William Hague’s visit here in January, and my own visit to London in April.”

The previous UK government used environmental grounds to justify imposing a higher levy on long-distance flights.

“With the tax for New Zealand-bound passengers set at four or five times the costs of offsetting the carbon emissions produced, this logic is without basis,” Mr Key said.

“The British Government’s announcement overnight maintains this cost difference, and ignores the fact that environmental concerns about emissions are being addressed through the European Union’s extension of its Emissions Trading Scheme (ETS) to aviation emissions.

“That puts a levy on airlines – meaning there is no justification for an additional duty on air passengers which discriminates on the basis of distance.”

Mr Key said the New Zealand Government had been hopeful that the British Government had been persuaded not to proceed with an increased APD that discriminated unfairly against Australia, New Zealand, the Caribbean, Singapore, South Africa and a few others.

“However, with this latest announcement it is clear that the APD will remain an issue between New Zealand and the UK,” Mr Key said.

“We will continue to raise this with the UK at every opportunity.”