John Evans, chief financial officer at Wings Travel Management, has predicted a “significant” increase in APD.
The government’s forecasts for Air Passenger Duty show revenue from the tax is expected to rise by nearly $1 billion.
Evans said this increase can only come from a hike in APD: “The only way to reach the forecast goals will be through significant rate increases in 2012 and 2013.”
Considering the prevailing economic conditions in the UK, he said, and given that total passenger numbers have declined throughout each of the past three years since the introduction of APD, an increase in the tax seems inevitable.
“We’re warning our clients to brace for significant APD increases next April,” said Evans.
The Wings boss sees it as further bad news for the TMC’s core oil and gas clients, following the announcement of an increased tax on North Sea oil companies in the Budget.
Evans also warned: “Raising APD taxes on top of already high taxes on air travel in the UK may begin to change the travel dynamics in the UK as it becomes increasingly expensive for business and holiday travellers.”
Airlines and travel companies had breathed a sigh of relief following this month's Budget, after the Department for Transport announced APD would be frozen until next year.
Despite the temporary respite, passengers travelling from the UK remain among the most heavily taxed in terms of air travel duties, according to IATA.
www.wings.travel