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New report says 50% cut would boost economy

Edinburgh airport boss urges ministers to set timetable for APD cut

Gordon DewarEdinburgh airport chief executive, Gordon Dewar, has called on Scottish ministers to set out a timetable for cutting air passenger duty to allow airlines and the tourism industry to plan for the change.

A new report produced by the airport claims that cutting APD by half will create 3,800 jobs over the next five years and provide a £200 million a year boost to the economy.

From May, APD will no longer apply to under 12s and powers over APD will ultimately be transferred to the Scottish Government, as recommended by the Smith Commission.

Mr Dewar wants the Scottish government to indicate when it will introduce its promised 50% cut.

He said: “We‘ve long argued that APD is a tax on Scotland’s ability to compete with European airports of or size, and our economy is footing the bill in lost jobs and lost opportunities. It’s also damaging the ability for our passengers to travel and to take advantage of the amazing connectivity we have from Edinburgh.

“Our report shows that the economic benefit of a reduction will outweigh any lost tax revenues. It’s therefore reasonable for passengers, airlines and the tourism industry to have some certainty on when this regressive tax will be reduced, and to know whether it will eventually be scrapped.”

The report, produced in partnership with independent consultancy firm York Aviation, reiterates the findings of previous studies undertaken on behalf of Scotland’s airports and shows that APD is a significant barrier to growth.

It says a 50% cut in APD would mean:

  • Economic benefits worth £200 million a year;
  •  3,800 jobs by 2020;
  • safeguarding one million passengers a year;
  • avoiding £68 million in lost tourism expenditure every year.

Mike Cantlay, chairman of VisitScotland, said: “There is no doubt that Air Passenger Duty is acting as a major deterrent to many potential visitors. Few other EU countries levy APD, so this places Scottish tourism at a competitive disadvantage.”

Tristan Nesbitt, chairman of the Edinburgh Hotels Association, said: “In order to remain competitive and to continue enticing more visitors to our city, it is crucial that Edinburgh is perceived as somewhere that offers great value for money.

“A reduction in air passenger duty would make Edinburgh more competitive in all tourism segments, particularly in terms of business tourism which is key to driving year-round demand for the city. It would also ensure that the tourist industry continues to grow in Scotland, securing and generating more jobs within this important economic sector.”

Edinburgh airport is Scotland’s busiest airport. More than 40 airlines serve 100-plus destinations and over 10 million passengers passed through the airport in 2014 – the busiest year ever for a Scottish airport.

It is the fifth largest in the UK, in terms of passenger numbers, and employs more than 5,000 people, contributing hundreds of millions of pounds to Scotland’s economy.

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