Committee Recommends Action on Air Travel Tax

Session: 2011/2012

Date: 16 May 2012

Reference: CFP 03/11/12

The Assembly Committee for Finance and Personnel today published a report on the proposed devolution of powers on Air Passenger Duty, ahead of an Assembly debate on Monday 28 May.

The Committee sets out steps to minimise the extra burden which Air Passenger Duty places on the local economy. The report was informed by research and consultation with stakeholders, including the airports, airlines, Federation of Small Businesses, the Northern Ireland Chamber of Commerce, the Consumer Council, local Councils and tourism bodies.

Commenting on the Committee’s work, Chairperson, Conor Murphy, MP MLA, said: “The evidence provided to the Committee shows that Air Passenger Duty is especially damaging to the local economy and unfair to consumers here, given the peripheral location of the region, with its greater dependence on air travel, and the competitive advantage enjoyed by Dublin Airport in particular.

“I commend the Executive for the responsive action it has taken to negotiate the devolution of powers over direct long-haul rates of duty, which has secured the vital Belfast - Newark connection. However, further work is needed and the Committee has charted a way forward.

“Action needs to be taken to maximise the economic opportunities arising from the powers now being devolved, including to establish new direct long-haul flight connections to key business and tourism hubs, such as Canada, the United States and the Middle East. The Executive also needs to commission a business case for the devolution of powers over the short-haul and domestic rates of duty, which apply to 98% of all flights from the region. Stakeholders are clearly saying that reduced rates on these flights would help to rebalance the economy and any Executive decisions on whether or how to exercise powers to reduce these rates of duty could be based on forecast return on investment. Given its importance to growing the economy, this issue deserves to be considered alongside the work to achieve devolution of corporation tax powers.”

ENDS

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