Published: 10:00, 06 February 2013 |
Updated: 09:43, 10 January 2014
by business editor Trevor Sturgess
"Outrageous" hikes in passenger flight tax are hitting job creation at Manston airport and the wider Kent economy, according to the terminal's boss.
Charles Buchanan, airport chief executive, has joined four major UK airlines in criticism of Air Passenger Duty and calling for it to be scrapped.
An airline-commissioned study on the economic impact of APD shows abolition could boost the UK economy, generate a net tax gain for the Treasury and create almost 60,000 jobs.
The study by PricewaterhouseCoopers (PwC) says the economy would benefit by at least £16 billion within three years of abolition.
It claims revenues from other sources such as income tax and Vat would rise, airlines would step up investment, and there would be a boost to tourism and business productivity through more overseas travel.
Mr Buchanan, pictured right, said the tax was "unrealistically higher" than anywhere else in Europe. Paris, for example, attracted six times as many Chinese tourists as London, partly because French visas gave access to other EU countries such as Italy and Germany, but also because of lower flight taxes.
Manston, which unveils KLM flights to Schiphol in April, could support 3,000 jobs - 2,000 at the airport and 1,000 in related activity - if it grew to two million passengers and 160,000 tonnes of freight within eight years. Without APD, those targets could be achieved sooner, Mr Buchanan said.
"If APD continues to grow at the rate it has been in the past, then we will continue to suffer and achieving these levels will be pushed further out," he said. "Taxing at an unacceptable rate clearly has a negative impact. We have got to the stage where you’re adding £100 to the cost of a ticket."
He added it was a regressive tax that hit poorer people harder than the better off.
"I would love to see APD scrapped. But failing that, a reduction, and failing that, at least held at the current level and not escalating every year. No more increases. APD has gone up outrageously. Don't squeeze it too tight. There is a golden egg there and the goose is struggling."
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