Air passenger duty: changes to rates
Published 8 March 2017
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This publication is available at https://www.gov.uk/government/publications/air-passenger-duty-changes-to-rates/air-passenger-duty-changes-to-rates
Who is likely to be affected
Airlines and other aircraft operators, and their passengers.
General description of the measure
The rates of Air Passenger Duty (APD) for the tax year 2018 to 2019 will increase in line with the retail price index (RPI) as is forecast at Spring Budget 2017.
Policy objective
This measure increases APD rates and therefore contributes to the government’s deficit reduction objectives.
Background to the measure
The rates for the tax year 2018 to 2019 are being announced at Spring Budget 2017 to give the industry sufficient advance notice of changes in APD rates.
APD is due to be devolved to Scotland in 2018.
Detailed proposal
Operative date
The rates for the tax year 2018 to 2019 will have effect in relation to the carriage of chargeable passengers on or after 1 April 2018.
Current law
Section 30 of Finance Act (FA) 1994 sets out the rates of APD.
Proposed revisions
Legislation will be introduced in Finance Bill 2017 to amend section 30 of FA1994. The rates will be as follows:
From 1 April 2018
| 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) |
| Band A (0-2000 miles) | £13 | £26 | £78 |
| Band B (over 2000 miles) | £78 | £156 | £468 |
(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.
Summary of impacts
Exchequer impact (£m)
| 2017 to 2018 | 2018 to 2019 | 2019 to 2020 | 2020 to 2021 | 2021 to 2022 |
|---|---|---|---|---|
| nil | nil | nil | nil |
This measure is not expected to have an Exchequer impact.
Economic impact
This measure is not expected to have any significant economic impacts.
Impact on individuals, households and families
The increase in APD is in line with RPI and is not therefore expected to have a significant impact on individuals, households or families, and is not expected to impact on family formation, stability or breakdown.
Equalities impacts
This measure will impact on those who travel more by air. Some protected characteristics are likely to be over represented in the class of people who travel by this means.
Impact on business including civil society organisations
This measure is expected to have a negligible impact on businesses. The 800 aircraft operators paying APD affected by the rate change will incur a negligible one-off cost to update their systems. There are not expected to be any additional on-going costs.
There is no impact on civil society organisations.
Operational impact (£m) (HM Revenue and Customs (HMRC) or other)
Costs to HMRC of implementing this change are expected to be negligible.
Other impacts
Other impacts have been considered and none have been identified.
Monitoring and evaluation
HMRC will assess the impact of the measure by monitoring receipts and information collected on tax returns.
Further advice
If you have any questions about this change, please contact Ann Little on Telephone: 03000 586096 or email: ann.little@hmrc.gsi.gov.uk.