MSPs to debate cut to Air Departure Tax
The bill will see Air Passenger Duty, devolved to Scotland as part of the 2016 Scotland Act, replaced by an Air Departure Tax from April 2018, set at half the current rate
Airplane - credit: Fotolia
The Scottish Parliament will today debate stage 3 of the Air Departure Tax (Scotland) Bill, with SNP plans to cut the duty paid on air travel by half expected to pass with a majority of MSPs in support.
The bill will see Air Passenger Duty, devolved to Scotland as part of the 2016 Scotland Act, replaced by an Air Departure Tax from April 2018, which will be set at half the current rate.
Ministers then plan to abolish the tax – which generates around £150m per year – “when circumstances allow”.
But while the SNP has argued the cut will stimulate economic growth, the plans have faced criticism from environmental and poverty campaigners, as well as opposition parties.
While opposition parties agreed that power over the tax should be devolved, they rounded on the SNP’s plans for a tax cut.
The Scottish Conservatives prefer limiting the tax cut to long-haul flights, in an attempt to encourage more direct long-haul flights from Scotland. Analysis from the Scottish Greens showing that the richest 10 per cent of households stand to gain four times more than the poorest 10 per cent from the cut.
Scottish Labour’s transport spokesperson Neil Bibby MSP said: “The SNP’s proposed tax cut for the wealthy has already been widely criticised by environmental groups.
“Cutting taxes for the richest will do nothing but harm our public services that are already bursting at the seams due to £1.5billin of SNP cuts since 2011.
“Nicola Sturgeon must explain who will pay for this multi-million pound giveaway for the wealthiest.
“The SNP must drop its plans to cut this tax and instead focus on growing our economy and investing in our public services.
“If anything should signal to the First Minister just how wrong she is, it should be the fact that she finds herself on the same side of the argument as the Tories’ DUP allies on this.”
Introducing the bill, Derek Mackay said: “The plans are a key part of the Scottish Government’s economic strategy, in particular in boosting trade, investment, influence and networks, which are especially important given the economic threat posed by Brexit. Scotland’s airports are competing on the world stage to secure new routes and capacity.
“Reducing the tax burden helps to ensure that there is a more level playing field with the many other European airports that are competing to secure the same airlines and similar routes. New routes will enhance business connectivity and tourism.”
Writing for Holyrood last year, Mike Robinson, Royal Scottish Geographical Society chief executive, questioned the logic of cutting the tax in a time of austerity.
He said: “With tax revenues as stretched as they are (and even worse are forecast to become), local authorities are cutting back right left and centre. And above all else we are choosing to give a £300m tax break to aviation. But why single out aviation? It always seems to get special treatment, as if it is the only industry capable of creating economic stimulus.”
Meanwhile the Church of Scotland warned the proposals were “likely to widen the inequality gap, as well as increase carbon emissions”.
Church of Scotland climate change officer Adrian Shaw said: “As a way to tackle poverty it is difficult to see how this tax cut would have any real benefits other than a possible boost in employment within the Scottish tourism industry or other sectors of the economy.
“Evidence for this comes primarily from the aviation industry which cannot be treated as impartial.”
In June parliament voted to replace Air Passenger Duty with a new Air Departure Tax, which is expected to be substantially lower
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