New UK Government planning to replace APD with a per-flight duty

In its May 2010 coalition agreement, The Coalition: our programme for government, the new United Kingdom Government, in the Energy and Climate Change section, has confirmed that:

"We will replace Air Passenger Duty with a per-flight duty."

This follows election manifesto commitments to:

"- reform Air Passenger Duty to encourage a switch to fuller and cleaner planes." Conservative Party manifesto (page 23)

"Ensuring pollution is properly taxed by replacing the per-passenger Air Passenger Duty with a per-plane duty (PPD), ensuring that air freight is taxed for the first time. We will also introduce an additional, higher rate of PPD on domestic flights if realistic alternative and less polluting travel is available." Liberal Democrat Party manifesto (page 14)

Related media coverage appeared in The Independent and the Daily Mail on 13 May 2010, and The Telegraph on 14 May 2010.

This issue was the subject of a similar proposal in 2007 (previous post). Following consultations the idea was rejected by the previous Labour Government.

The design details of how the per-flight duty would work has yet to be announced.

How closely the amount of revenue collected reflects the environmental costs (previous post) and whether it would be adjusted in light of the extension of coverage of the EU emissions trading system to cover international aviation remains to be seen.