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Simon Calder gives verdict on Budget 2024 air passenger duty and reveals how to avoid it

Simon Calder’s Travel

The chancellor has announced another increase in air passenger duty (APD). This is the tax that passengers aged 16 and over must pay when flying from most UK airports.

For the tax year 2025-26, APD will rise by predicted inflation for those in the cheapest seats – but by more than that in anything other than basic economy.

Air passenger duty is seen as a perfect tax by politicians. It is difficult to avoid and easy to collect, because airlines do all the work and send the Treasury a cheque.

APD is unique to the UK, and a topic of much controversy:

  • Is it a “green” tax or simply a revenue-raising device?
  • Does it encourage less damaging behaviour by travellers or inadvertently cause more harm?
  • Should it be eliminated or sharply increased?

The debate is set to intensify, along with an increasing number of travellers avoiding APD through a variety of means.

These are the key questions and answers.

A brief history of air passenger duty

The man responsible for APD was the last Conservative chancellor of the 20th century, Kenneth Clarke. He told me: “Aviation was in an unusual position in that it’s the only form of transport where no one was paying any tax on the fuel that it uses.

“For years and years governments have regarded it as totally normal to impose tax on petrol, diesel fuel and everything used by land and sea. For historic reasons nobody was placing any tax on air fares.

“For me that was an anomaly, not least because people who use aviation tend to be slightly more prosperous than those who use other forms of transport.”

Air passenger duty will be increased for passengers with premium economy, business class and first class tickets (Alamy/PA)

As international aviation agreements generally rule out a tax on jet kerosene, Mr Clarke instead imposed air passenger duty of £5 on each European flight, and £10 on long-haul services. It applied to all passengers above one year of age starting a journey at a UK airport, and took effect in 1994 – just a year before easyJet started flying.

What has happened since?

Mostly, it has increased – partly because It can be presented as a “green” initiative, dampening demand for aviation. And many of the people who pay it are foreign visitors and do not vote in the UK.

The next chancellor, Gordon Brown, doubled the tax for business- and first-class seats. (One bizarre loophole, since…

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