BBC Radio 4 'Today' programme reporting that the govt is looking at abolishing APD for all domestic routes - as well as helping BE, helps their 'regional connectivity' agenda. Nice windfall for BA, etc.. If true so much for trying to reduce UK air travel and helping to reduce pollution not that I ever liked the tax but it did serve a purpose in reducing demand. This if proposed as a Flybe only deal would be banned by the EU although I would just tell the EU to get stuffed as we are leaving anyway so get over it. |
It shouldn’t be allowed as a Flybe only deal. If you want to reduce APD on domestic routes then it has to be for every carrier, not just Flybe.
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Originally Posted by LTNman
(Post 10662334)
If true so much for trying to reduce UK air travel and helping to reduce pollution not that I ever liked the tax but it did serve a purpose in reducing demand. This is being proposed as a Flybe only deal would be banned by the EU although I would just tell the EU to get stuffed as we are leaving anyway so get over it.
You can't just tell the EU to get stuffed. It's either all of Europe or none of Europe. That's the law. |
Originally Posted by LTNman
(Post 10662334)
If true so much for trying to reduce UK air travel and helping to reduce pollution not that I ever liked the tax but it did serve a purpose in reducing demand. This is being proposed as a Flybe only deal would be banned by the EU although I would just tell the EU to get stuffed as we are leaving anyway so get over it.
One good thing about our new Government is their fragile landslide which comes only from the midlands/north will hopefully force some better and tangible regional policy. |
It’s a tough call. Other EU countries ignore EU law while we follow the rules. Surely we will be unleashed next year to follow our own path but then no doubt the EU will still think they have full control over a sovereign nation that is outside the EU if we want a trade deal.
The EU position is that for Flybe to get a domestic concession then all airlines get a concession so giving tax breaks to profitable airlines like Easyjet and BA. UK airports follow different rules as Inverness for example is exempted while Aberdeen gets the tax added to their domestic flights. |
As you can imagine the frontline staff at Flybe are very upset at the news of millions of pounds of tax being owed to the UK Gov. This has come as a complete suprise as most employees would have little knowledge of the accountancy procedures and would have assumed that APD was being forwarded in the normal way.
It really hasn't been mentioned before this weekend. Many are still worried about their jobs and can't understand how this situation has been allowed to build up. Questions will need to be answered by the directors. |
Originally Posted by Jonty
(Post 10662335)
It shouldn’t be allowed as a Flybe only deal. If you want to reduce APD on domestic routes then it has to be for every carrier, not just Flybe.
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Taxes can be deferred, question is have they already previously deferred tax (I havent seen the accounts) .
It then becomes a question of what is the likelihood of paying the deferred amount, are there other creditors, do they have any fixed and floating charges, what are the assets. |
Originally Posted by Jonty
(Post 10662335)
It shouldn’t be allowed as a Flybe only deal. If you want to reduce APD on domestic routes then it has to be for every carrier, not just Flybe.
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Originally Posted by onion
(Post 10662376)
Taxes can be deferred, question is have they already previously deferred tax (I havent seen the accounts) .
It then becomes a question of what is the likelihood of paying the deferred amount, are there other creditors, do they have any fixed and floating charges, what are the assets. |
Grant Shapps is well down the food chain on this one, so won't be calling the shots.
BBC - Flybe: UK air passenger duty cut considered to save airline The government is to consider cutting air passenger duty on all domestic flights as part of a plan to save regional airline Flybe from collapse. Improving connectivity outside of London was a key Conservative manifesto pledge and at least one of Flybe's routes, between Newquay and London, is subsidised by the government. The amount depends on the destination and class of travel. Under current rules, passengers on domestic flights pay £13 in APD for a single journey, with higher rates for longer flights and premium cabins. Flybe is a long-time critic of air passenger duty which it said disproportionately burdens its domestic customers because they have to pay it each time they take off from a UK airport. |
Originally Posted by toscana24
(Post 10662394)
Air passenger duty is paid by passengers in advance - i.e. when they buy their tickets - the amounts collected should be remitted to the Govt via a monthly return. That actually helps the cash flow of businesses BUT it is not money an airline should use for their own business purposes; to do so to my mind is a "criminal" misuse of APD paid by a pax to Govt via the airline. If, as is being reported, BE owe £100m, someone should be held accountable. No one likes paying APD (or any taxes) but when a businesses diverts taxes to keep themselves afloat that is clearly wrong.
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Originally Posted by AirportPlanner1
(Post 10662354)
One good thing about our new Government is their fragile landslide which comes only from the midlands/north will hopefully force some better and tangible regional policy.
Key issue here is the collateral damage flybe going bust would cause to the lives of voters, especially places outside of London which we are assured do exist. (Cheeky, but you see my point.) it’s the English equivalent of Loganair going bust, it’s too much of a key part of too many people’s lives. |
" too much of a key part of too many people’s lives"
I really really doubt that. If it was so important why are they in a hole? Like all other airlines that go bust in 3 months people won't remember them (except on this website) If there IS a need then someone else will try and fill it - hopefully without using tax payers money. |
Quick bit of maths - 8 million passengers and £13 APD makes £104 million tax. Thus the £100 mil figure being bandied about is a whole years APD tax that hasn't been sent to the HMRC :eek: How has that situation been allowed to develope? Surely the tax man would have noticed the lack of income from this airline?
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Originally Posted by ETOPS
(Post 10662412)
Quick bit of maths - 8 million passengers and £13 APD makes £104 million tax. Thus the £100 mil figure being bandied about is a whole years APD tax that hasn't been sent to the HMRC :eek: How has that situation been allowed to develope? Surely the tax man would have noticed the lack of income from this airline?
Sadly, the people at the coalface, who mostly provide great service, and the Customers (many of whom no doubt do rely on the "lifeline" nature of some of BEE's services) will be the ones to suffer if a solution can't be found. For the sake of all of the latter I hope it can. |
Originally Posted by LTNman
(Post 10662369)
It’s a tough call. Other EU countries ignore EU law while we follow the rules. Surely we will be unleashed next year to follow our own path but then no doubt the EU will still think they have full control over a sovereign nation that is outside the EU if we want a trade deal.
The EU position is that for Flybe to get a domestic concession then all airlines get a concession so giving tax breaks to profitable airlines like Easyjet and BA. UK airports follow different rules as Inverness for example is exempted while Aberdeen gets the tax added to their domestic flights. |
Outrageous that the government are even considering this.
What other business would be allowed to keep £100m+ in tax because it's struggling to stay afloat? I'm sick and tired of big businesses trying to privatize profit and publicize losses. There should be a full investigation as to why they've been allowed to withhold over a year of tax payments! Mothercare had a similar amount of staff -- why weren't they allowed to pocket the VAT collected on sales to allow them to continue business? Because it's bonkers, that's why. If Flybe provides a needed service with a high loadfactor (which I believe it does) then another company will be able to set up and perform, or alternatively another airline will take those routes over. Besides this tidy corporate welfare handout to the Virgin consortium, what's going to miraculously change at Flybe to allow it to continue? What happens next year when they're burnt through the cash? Yes, it's sad for the frontline staff but the government shouldn't be in the business of emotional corporate welfare. If Flybe as a business can't perform its duties due to poor business decision then it needs to fail. Simple. |
Originally Posted by LTNman
(Post 10662334)
If true so much for trying to reduce UK air travel and helping to reduce pollution not that I ever liked the tax but it did serve a purpose in reducing demand. This if proposed as a Flybe only deal would be banned by the EU although I would just tell the EU to get stuffed as we are leaving anyway so get over it.
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This is a mess. What proportion of Flybe's routes can bee deemed essential If they are they should be identified and operated under some kind of PSO agreement and as a taxpayer I would support that. Bit I can't support help being given to take wealthy pensioners for example to their second home in France under the same umbrella. That is giving Flybe competitive advantage as an entity when compared with competitors.
I can't help thinking that in its present form Flybe is not able to be saved and it is better to start with a clean sheet - or maybe several different sheets. |
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