APD to be scrapped on BFS - EWR?

[crewmeal]

APD to be axed on Belfast – New York route? : Belfast Airport News Stories (http://www.uk-airport-news.info/belfast-airport-news-270911.html)

What about the rest of the UK then? I'm sure there are areas in the UK that would benefit from better trade links such as BHX and MAN. With some fares could this mean it would be cheaper to fly from the UK mainland to connect with the CO flight to EWR? If that were the case watch out BHX and MAN.

[ara01jbb]

What about the rest of the UK then?

The rest of the UK doesn't share a land border (and a completely open one with very good road connections) with a neighbouring EU country that has a €3 long haul departure tax.

[sealink]

Excellent news. N I should receive this assistance. We are basically an island off an island. Consider travel to London. We fly there. People from EDI , MAN , GLA , NCL , etc etc can travel by car , coach or rail.

[MrBenip]

Quote "We fly there. People from EDI , MAN , GLA , NCL , etc etc can travel by car , coach or rail." - What! to New York?

[ara01jbb]

I don't think Sealink quite understands this development. We are indeed still an island off an island, but this change makes no difference to domestic and short haul APD, only long haul APD, which is damaging to flights ex-BFS because DUB is cheaper and only two hours away.

Incidentally, DUB is still a nice airport to use and US Pre-Border Clearance is a huge bonus, so I for one will still compare prices ex-BFS and ex-DUB before committing all my future travels to CO's BFS-EWR run.

[stab3.5up]

The underlying tone here guys is verging on the offensive and I think the mods should keep an eye on this thread before it gets to political

[midland02]

"Excellent news. N I should receive this assistance. We are basically an island off an island. Consider travel to London. We fly there. People from EDI , MAN , GLA , NCL , etc etc can travel by car , coach or rail. "

It costs more to drive to London than fly.... (unless you have a super efficient car) Rail? kind of depends but doesnt go direct to an airport in London so you still need to pay another fare. I would find it difficult to justify Coach considering the time (extra day to travel.)


Abolish it all over UK :-)

[clareview]

The fine detail is that it is not being abolished but the long haul APD is being reduced from £60 to match the short haul duty of £12. Interesting that flights in the Scottish islands have no APD so there are already regional differences

[j636]

Its all well and good for Gov to reduce taxes but what have Belfast int airport done to help CO?
It is costing CO more to operate from BFS than DUB. Passenger service charges are higher in BFS than DUB.

Its not just the BFS but MAN and BHX, LHR etc are costing CO more to operate from.

[Facelookbovvered]

I think you miss the point here, CO have traffic bleeding to Dublin from BFS that makes BFS loss making, that is not happening to traffic at MAN/BHX/LHR, the bottom line is that is more costly if you live on the mainland to try and avoid the punitive levels of APD charged here, where as in NI you can nip on a bus/train or drive down to Dublin and save money, many are doing just that and interlining with KLM via AMS before flying back over the UK & NI West bound, not very green is it?

If you look at the Ugov website on APD it sets all the rules out about what is a linked flight, fly from say MME to AMS with KLM in economy and then to Vancouver in business and the UK APD system will charge you £11.00 for the flight to AMS plus the full APD business rate for the Vancouver portion as though you had flown from the UK direct.

It even worse from NI fly with bmi from BHD to LHR and onto Vancouver return, you pay APD on the first two sectors, stay overnight in LHR when you get back and you'll get clobbered for APD on your flight back to BHD.

The very fact that the Government appear to have given way on this suggest a major review is incoming, probably to be announced at next April's budget for implementation in 2012/13, this would have been to late for CO plans, if its valid for New York its valid for all long haul flights

Green my arse!!

[Aero Mad]

As others are saying... if the Government recognises that it is harming Northern Ireland, why is the same principle not applicable to the UK mainland?

APD is a poor excuse for a tax which really needs sorting out. I don't blame 'the politicians'; I blame the misinformed money grabbers. We need a fairer tax and less of a tax. A pie chart for govt. income shows that it is a tiny tax which causes huge harm. Something needs to be done.

[clareview]

APD is of course a strange tax as presently levied. However Northern Ireland is, as has been stated above, the only part ofthe UK with a land border with another country - the Republic of Ireland where APD is €3. In addition, Dublin airport is less than 2 hours from Belfast by road. In the Scottish Island, for different reasons, APD is zero so the arguement for different amounts of APD for different regions has already been accepted.

This puts Northern Ireland in something of a unique position compared to Man, BHX and LHR where Facelookbovvered says United Continental is making a loss (if this is correct why have services not been reduced/cut?).

[jabird]

Rail? kind of depends but doesnt go direct to an airport in London so you still need to pay another fare.

Eh? The whole point of taking the train is that it plonks you right in the city centre. It is the journey from the airport into the city centre that can add an extra fare, sometimes not that different to the advance purchase fare all the way from EDI to LON. If you mean rail for taking connecting flights, very few people would travel by land from Scotland to take a flight from a London airport.

The iniquity imho is that if you are making a domestic journey in the UK (benefitting the UK economy), you will still pay two sets of APD. Fly anywhere else, and you will only pay once, or you will at least pay a much lower rate for the return leg back to the UK - afaik, the highest APD equivalent in Europe currently being €8 (Germany).

[Planemike]

The underlying tone here guys is verging on the offensive and I think the mods should keep an eye on this thread before it gets too political



Errrrrrrrr......... Offensive??? I have read through the threads and can see nothing that can be read as offensive. What do you mean?

Planemike

[jabird]

Planemike,

I was thinking exactly the same thing! APD is inherently political - it is labelled as a green tax, but is no such thing, and now we have a regional variation, in addition to the Scottish and Welsh (often pso aswell) exemptions mentioned above.

If we want the gloves off, dare I mention the relative funding differences between the different corners of the UK, a disparity which will only be increased further by this move. Fire away!

[nigel osborne]

With no new runways planned at Heathrow, and the Govt wanting more flights to regional airports, then surely they have to increase APD to London Airports and reduce it to regionals such as BHX,MAN ??.

Otherwise airlines such as United into BHX will be forced to pull out.

You shouldn't be clobbering Regionals.:=

Nigel

[nef]

As you say, given the lack of capacity at LHR (and in the SE generally), increased APD at LHR and/or reduced APD at regionals should seem like an obvious step which might help to boost regional economies as well. However, this is government we're talking about (and one that draws a large part of its support from the SE):rolleyes:.

[delta154]

I personally think this has set a dangerous precedent.

Why should 1 single route one 1 single airline be given preferential treatment? Yes it is great for Belfast, but its not just Belfast that is being strangled by this tax.
Where was the governments assistance when Air Asia X publicly cited they chose not to fly from Manchester due to APD? With this in mind, I can see other airports using this to lobby change.

I think you miss the point here, CO have traffic bleeding to Dublin from BFS that makes BFS loss making, that is not happening to traffic at MAN/BHX/LHR

The thing is though, whilst the fare prices may be higher, there is nothing stopping an individual hopping on a ferry or the Euro tunnel to Paris, Brussels or Amsterdam, and surely that whilst the numbers wont be earth shattering, there must be some leakage to avoid APD that way?
That's no different to those in Northern Ireland hopping over the border for reduced fares there.

[MerchantVenturer]

I have a letter sent to me via my MP from Justine Greening a Treasury Minister in which she points out that the 2011 Budget announced a freeze in APD and the launch of a consultation on its future structure.

The APD consultation was completed on 17 June this year and set out proposals for simplifying the current banding system as well as inviting views on the subject of devolution (of APD) to Northern Ireland, Scotland and Wales.

The consultation received 'many responses from people and organisations in England, Wales, Scotland and Northern Ireland'.

Justine Greening went on to say that 'several airlines, airports and individuals have raised concerns regarding the potential distortion arising from differential APD rates between Cardiff and Bristol, as well as between Newcastle and the Scottish airports'.

The Government is considering the views and evidence submitted and will publish a response in the autumn.

If APD is ultimately devolved to Wales, Scotland and Northern Ireland those countries' governments could reduce (even to a nil band) or alter their APD rates whilst English airports' APD would still be regulated by the Westminster Government.

It may well be that the reduction in Northern Ireland's long haul APD rates is a short term measure that could be further altered locally if this tax is devolved to the Northern Ireland Government.

[sealink]

MrBenip & ara01jbb. Please read and understand my comment as i completely understand this issue. You will see i say " consider travel to London ". I am making a statement that to travel BHD/BFS to London you fly. as we are an island off an island we should be a special case when it comes a APD. Similar to the Highlands and Islands. If We are forced to fly then ALL APD should be reduced or scrapped....... ALL OVER THE UK PERHAPS. The reduction on the BFS to EWR should also apply to Domestic. MrBenip..... or MR Sarcastic should i say...... hardly drive to New York!!!!! Your joke is hilarious!!! As i said my comment was a general comment relating to travel to London from N Ireland. An ara01jbb..... I understand this relates to CO BFS EWR Long Haul APD. 16 years in the airline industry helps me understand!!!!

[crewmeal]

Osbourne now makes it official.

APD cut on Belfast – New York flights : Belfast Airport News Stories (http://www.uk-airport-news.info/belfast-airport-news-280911.html)

These politicial arguments will drag on forever. Govts past and present will look to tax anything they can get their hands on. The last one invented APD and the present one certainly won't do anything to reduce it (I'm refering to England). They wonder why there is no growth in aviation especially in the Regions. My feeling is it will only get worse.

[Facelookbovvered]

Driving or catching the train to say CDG to avoid APD doesn't add up, by the time you have paid the fare, the fuel, the car parking it makes no sense, unless your taking a minibus full of people, the NI case is very different, yes you still have to pay for fuel and parking, but if you live to the South of BFS there not a lot in it and if there is two or more travelling it really adds up your looking at a saving of £57 per person!

Reading the press release, it suggest any direct long haul flight, Jet2 to the US or Canada anyone?

[EI-BUD]

I am making a statement that to travel BHD/BFS to London you fly. as we are an island off an island we should be a special case when it comes a APD. Similar to the Highlands and Islands.


Sealink, I disagree with this statement in the context of NI. While I agree that the APD should be lower due to the competition from over the border (on the same Island) being an Island off an Island is no good reason in our case to be a special case; the people of NI have options to fly from Dublin at a lower rate of tax.

GB is also an Island off an Island (Ireland, North and South if we are to be precise) so should it get special status also?

The government should work closely with CO/UA to monitor their boardings both on DUBEWR and BFSEWR and try to see in overall terms the upsides from reducing the APD. This should give them some help in trying to ascertain what the likely impact an overall improvement in tourism such an investment would make. Of course we could argue about the approach to such a measurement but CO/UA have the figures which can give clear data year on year. We will have acess to NI & UK stats and the ROI may be available as CO is the only operator on the EWR DUB route.


EI-BUD

[sealink]

Why would i choose to travel to Dublin to fly with a carrier that operates from an airport 15 minutes from my door? I would want to support the local operation as i have done before. So in order to compete with the 3 euro tax the APD from Belfast should be lowered accordingly... as it will be.

[pzu]

Is it possible to avoid APD (at least the more punitive aspects) by booking via one of the European Hubs - Amsterdam, Frankfurt or Paris? or even Dublin and now possibly Belfast?

If so what are the Pitfalls?

PZULBA - Out of Africa (Retired)

[jabird]

pzu,

Yes, make two separate bookings, eg BHX to AMS then AMS to EWR.

The UK govt has no control over where you go once you have left UK airspace - they can only tax you when you make a through booking that originates in the UK.

So why doesn't everyone make separate bookings and avoid this tax? Simple pitfall - doing so gives you no through connectivity, no back up in the case of missed connection.

Hence APD is high enough to sting, high enough to give the green lobby a little less to complain about. It could probably go a little higher, but if it went up, say to £100 on a long haul sector (that's probably where FoE would want it), you would get a mass diversion to AMS, CDG, FRA etc, and it would be counterproductive.

Yes, govt wants to be seen to stimulate business, that is fine for the routes that carry business passengers, but we shouldn't forget that people flying BFS-EWR and then transferring down to MCO might be lining Eisner & co's pockets, but they are doing nothing for UK PLC. At least if they went with VS from LGW / MAN / GLA, they would be using a (partly) British carrier!

[EI-BUD]

Sealink , I'm not suggesting that you should travel down to Dublin to fly with CO, i am stating that us being as you put it 'an island off an island' is not good enough reason to give concession on tax level. And clearly this is not the reason why the tax is being reduced.


I too use my local route from BFS to EWR, and will also continue to do so!!

[Danny_R]

but we shouldn't forget that people flying BFS-EWR and then transferring down to MCO might be lining Eisner & co's pockets, but they are doing nothing for UK PLC.

Not strictly true though, as CO will still be paying BFS landing and nav fees, passengers departing for EWR will be paying the airport PLS and spending in the terminal or on car parking etc, all of which goes towards supporting UK business and in turn the economy.

There is only so far you can go with tax, much like any business, at some point the price becomes too much and people start using alternatives or just stop buying altogether, I fear the UK Government is going to find this out if they continue their APD rises, it certainly isn't doing anything for growth that they are so deperate to see from the private sector.

[clareview]

If the island off an island is not a reason why then do the Scottish islands have no APD?

The Northern Ireland - US route has considerable wider significance as far as wider business is concerned. Northern Ireland is being sold as a good place for US firms to invest and that strategy is paying off - lots of IT, multimedia and creative industries as opening in Northern Ireland - our senior politicians were on another sales mission to both the west and east coasts 2 week ago and some deals were done.

A direct route from Northern Ireland to the US makes that sell easier

[sealink]

Clareview...... i agree with all you say. Think we are maybe on the same wavelength.

[ara01jbb]

If the island off an island is not a reason why then do the Scottish islands have no APD?

The Northern Irish APD situation and the Scottish APD situation are not comparable.

NI APD is damaging to the local economy because unlike anywhere else in the UK, people can drive across a land border into a neighbouring EU country where the departure tax is much lower.

APD in the Highlands and Islands is reduced because those air links are "vital to the social and economic welfare of the areas they serve. (http://www.transportscotland.gov.uk/air/hial)"

Direct long haul services at BFS are not "vital to the social and economic welfare" of Northern Ireland, but this decision reflects the unique situation that the province is in, namely that it shares open land border with another country, and that airports like BFS are disadvantaged by the UK's APD tax in a way that no other in airport in the UK is.

[EI-BUD]

ara01jbb- I agree fully with you post.

If being an Island off an Island is worth talking about as I said earlier, the same could be said for the Island of GB it too is an Island off an Island, so for that reason should it be cutting all of its airport departures taxes? I think not.

Also the Scottish Islands are very different given that the people on these Island often need to travel to GB to avail of various services eg Hospitals etc...etc..

[sealink]

I think its plain to see who has a genuine interest in the airline industry and who treats it as a hobby and looks at it thru rose tinted glasses.

[crewmeal]

If BFS gained any other long haul routes would Mr Osborne reduce the APD for them? I would imagine carriers will be asking this question when route planning.

[BFS101]

The APD reduction applies to all direct long-haul routes, though currently this is only relevant to the CO EWR.


APD on direct long-haul flights from Northern Ireland will be cut to the same rate as short-haul flights from November 1, reducing the tax on economy fares to the US from £60 to £12 and in business class from £120 to £24.


While this APD reduction was to help secure the only scheduled US service, many of the press releases also talk of helping to establish further long-haul routes. Whether this actually translates into new routes remains to be seen, though I'd guess that YYZ should realistically be on the radar.

[crewmeal]

They wonder why there is no growth in aviation especially in the Regions.

Quoting myself from Friday, now this:

Regional airports want same tax reduction as Northern Ireland : Manchester Airport News Stories (http://www.uk-airport-news.info/manchester-airport-news-011011.html)

Looks like the management at BHX have woken up!!

[jabird]

Danny R - saying people heading down to MCO / SFB would help the economy because of spending at the airport is tenous. It would be equally stretching it to say that a direct MCO - BFS (scheduled not IT) route would help inbound tourism - yes, there are expats living in Florida, yes, there a Florida residents and business people who might visit NI, but would they make up more than 10% of seats?

I would love to see a breakdown of exactly who is going where on the current EWR-BFS sector. I understand around 70% transfer elsewhere, I don't know about breakdown by nationality.

I accept the logic in supporting this route - there is the prestige that having a long haul route brings to the city, and there is the argument that it is better to go direct than to go east to LHR etc before heading west. BFS also lacks other connection alternatives - eg to FRA etc.

However, just much do these benefits add up to. It seems strange to have one foreign company dictate tax policy to the chancellor, but it won't be the first time that has happened.

Yet aviation as a whole remains a net exporter of cash from the UK. Granted, that has to be put in the context that our climate makes foreign holidays much more attractive, but if we start seeing new routes to Florida, Mexico, the Caribbean etc from BFS, that cannot be good.

Meanwhile, if there is one sector of the market which must surely benefit the economy, it is the UK domestic flights! And they are still taxed twice.

[Danny_R]

Danny R - saying people heading down to MCO / SFB would help the economy because of spending at the airport is tenous.

Not tenuous at all, saying flights of the UK don’t do anything for our economy is simply untrue.

Most income at regional airports is generated from the presence of holiday flights out of the UK, when there are tens of thousands of pounds being spent in airport terminals every day it certainly is not insignificant. The passengers using those flights are supporting our economy regardless, their presence also means job creation, which brings me onto the fact you also need to take into consideration the wider economic impact of such flights on the local area, e.g. for hotels, travel agents etc. Just look at how areas surrounding some regional airports have been transformed over the past decade and tell me those holiday flights did not have any economic impact!

Like it or not domestic flights are no longer viable on many routes on the mainland due to improving rail links, also the Government will not support domestic flights either due to the greenies being highly against domestic air travel. International flights are the only option for economic growth and should be embraced.

[TSR2]

Most income at regional airports is generated from the presence of holiday flights out of the UK, when there are tens of thousands of pounds being spent in airport terminals every day

But this spend must be very small in comparison with the money leaving the country in total holiday costs and spend whilst on holiday abroad. If job preservation and support for home economy is the main criteria, then it could be argued that it would be more effective to encourage more people not to holiday abroad.

[LBIA]

Looks like more UK regional Airports and Airlines have now been added to this letter been sent to chancellor George Osborne about not been happy with the deal that that's done with Belfast regarding dropping ADP on there New York route.

See below: Regional aviation players demands fair APD reduction | News | Travel Trade Gazette (http://www.ttgdigital.com/news/regional-aviation-players-demands-fair-apd-reduction/4681790.article)

Regional aviation players demands fair APD reduction

A regional airport chief executive has suggested that the reduction of APD in Northern Ireland could possibly be illegal under EU State Aid Regulations.

Dave Laws, chief executive of Newcastle Airport said: “Any differentiation based upon geographical criteria, which appears to be the case with the Northern Ireland proposal, would be unfair and possibly illegal under EU State Aid Regulations.”

Laws added: A much fairer, and probably legal, approach would be to give all regional airports a stimulus by varying the rate of APD between congested and non-congested airports, thereby protecting the interests of all disadvantaged regions.”

His comments come after 12 regional airports and airlines have written to the chancellor George Osborne demanding a reduction in APD in the regions.

The group argues that the tax should be reduced on all flights from UK airports outside of London.

In the letter, the group says: “Regional airports and airlines have a lower percentage of business travellers or inbound tourists than the London airports, and have been hit hard by economic downturn. That’s not just bad news for our businesses. It’s bad for jobs, bad for inward investment and bad for wealth creation in the UK regions. If the government is serious about truly rebalancing the economy, then decisive action is needed on behalf of the 86 million passengers that fly from our airports.”

The joint letter is signed by Birmingham Airport; Bristol Airport; Exeter Airport; Flybe; Glasgow Prestwick; Jet2.com; Leeds Bradford Airport; Loganair; Manchester Airports Group (Manchester, East Midlands, Bournemouth and Humberside Airports); Manston International Airport; Newcastle International Airport and Newquay Airport.

[Danny_R]

But this spend must be very small in comparison with the money leaving the country in total holiday costs and spend whilst on holiday abroad. If job preservation and support for home economy is the main criteria, then it could be argued that it would be more effective to encourage more people not to holiday abroad.

You are of course right that the revenues generated at airports is far less than that abroad by those holidaying passengers, however given our climate we have to be realistic in our expectations, most people will not stay at home for their holidays, we have to support what we have, which in the UK's case is airports generating the most money they can from holidaying passengers and providing job creation.