30 October, 2024

Major increases in air passenger duty - announced today by Chancellor Rachel Reeves in the budget

In the budget today,  the UK's Chancellor Rachel Reeves has announced big increases in Air Passenger Duty.  

From 2026-27 Air Passenger Duty (APD) rates for short and long-haul flights will be adjusted to partially account for previous high inflation. 


Increases:

For economy passengers, 

Domestic flights        £1 

Short Haul                £2

Long Haul                £12 

Children under the age of 16 will still not pay APD. 

APD for larger private jets will be increased by a further 50%. this is approximately the equivalent of £450 per passenger.

The UK already has one of the highest air passenger duty rates in Europe and the Globe and the latest announcements do little to sway anger and dismay within the travel industry.

From 1 April 2026

Bands (distance in miles from London)Reduced rate (lowest class of travel)Standard rate (1) (other than the lowest class of travel)Higher rate (2)
Domestic band£8£16£142
Band A (0 to 2,000 miles)£15£32£142
Band B (2,001 to 5,500 miles)£102£244£1,097
Band C (over 5,500 miles)£106£253£1,141

(1) If any class of travel provides a seat pitch in excess of 1.016 metres (40 inches) the standard rate is the minimum rate that applies. (2) The higher rate applies to flights aboard aircraft of 20 tonnes and above with fewer than 19 seats.


The rates above for the tax year 2026 to 2027 will have effect in relation to the carriage of chargeable passengers on or after 1 April 2026.

Karen Dee, chief executive of AirportsUK, the trade association for UK airports, said:  "We welcome the extension of the advanced fuels fund by another year and the additional £975m in R&D funding for aerospace, which can support the sector’s transition to zero emission flight.

It was disappointing, however, that the chancellor increased air passenger duty, especially at a time when airports are investing in new security technologies, sustainable flight and airspace modernisation, as well as facing increasing burdens in other areas.

If the Government is serious about realising its aim for the UK is to become the fastest growing economy in the G7, then it must recognise and champion the role that airports play in growth and international connectivity, and minimise the cost and regulatory burdens imposed.”

Tim Alderslade, CEO of Airlines UK, the industry body representing UK-registered carriers, said:  “We welcome the announcement of a further 12 months of funding for the Advanced Fuels Fund, which will support UK sustainable aviation fuel production, a key airline priority with the SAF mandate due to commence in January. 

Air Passenger Duty, however, already makes the UK less competitive and further increases in addition to rises in other business levies will impact growth, directly hitting the pockets of ordinary travellers and making it harder for UK airlines to put on new routes. We need a revised and joined-up approach to the UK’s strategically vital aviation sector.”




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