Air Passenger Duty (APD) is set to rise on April Fools’ Day both this year and next. In Jeremy Hunt’s last budget as Tory chancellor, he imposed rises at or above the rate of inflation from 1 April 2025. His replacement, Labour’s Rachel Reeves, has kept those increases and imposed more of her own from 1 April 2026.
APD is the tax that passengers aged 16 and over must pay when flying from most UK airports.
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. As the Treasury said when publishing the increase: “HMRC will not incur any costs making these changes.”
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, as Michael O’Leary of Ryanair has said, 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.”
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, APD 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…
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