Official Statistics

Quality report: Air Passenger Duty Bulletin

Updated 24 October 2022

1. Contact

• Organisation unit - Knowledge, Analysis and Intelligence (KAI)

• Name - Indirect Tax Receipts Monitoring, Indirect Taxes, Customs & Co-ordination

• Mail address - Three New Bailey, Salford, M3 5FS

• Email - revenuemonitoring@hmrc.gov.uk

2. Data description

This publication provides a breakdown of historical receipts, chargeable passengers and liabilities for all Air Passenger Duty (APD) passenger bands.

The publication includes duty receipts statistics which are up to the latest full month before the bulletins release. It also includes statistics relating to liabilities and passenger numbers which are one month behind that of duty receipts.

Liabilities statistics relate to when APD is due to HMRC from anyone who operates a chargeable aircraft which carries chargeable passengers departing from a UK airport.

This publication only includes figures for previous years. Forecasts of future APD receipts are produced and published by the Office for Budget Responsibility (OBR), and can be found on their website.

2.1 Classification system

The data used to compile the APD Bulletin comes from several sources:

• cash receipts are taken from the Enterprise Tax Management Platform (ETMP)

• passenger numbers and declared liabilities are taken from APD2 tax returns from registered APD taxpayers which are sourced through the Enterprise Data Hub (EDH).

These forms and returns help classify the data within the APD Bulletin and provide the main breakdowns into the different passenger bands.

A unique taxpayer reference (UTR) number is assigned to each registered UK trader. These UTRs are used during the data aggregation process.

2.2 Tax coverage

APD is due to HMRC from anyone who operates a chargeable aircraft which carries chargeable passengers departing from a UK airport.

This analysis focuses on UK registered airlines, and those that operate from UK airports.

2.3 Variable definitions

APD receipts

The amount of APD paid to HMRC. This is revenue reported in the bulletin.

APD liabilities

The amount of APD which is due by taxpayers.

Liabilities are reported by the following passenger bands within the APD bulletin:

• Band A, which is defined by the flight being less than 2000 miles between London and the capital city of the destination country

• Band B, which is defined by the flight being more than 2000 miles between London and the capital city of the destination country

Financial year

The statistics are aggregated into financial years. A financial year stretches from 1 April until 31 March the following calendar year.

2.4 Statistical unit

The unit in the statistics is businesses and other entities required to pay APD within the UK.

2.5 Time coverage

The statistics cover the time period from financial year 1994 to 1995 until the latest financial year for which a complete set of APD returns are available.

3. Statistical processing

3.1 Source data

The data for APD receipts and liabilities comes from:

• cash receipts are taken from the Enterprise Tax Management Platform (ETMP), this platform contains total APD receipts which are the main focus of the bulletin commentary

• passenger numbers and declared liabilities are taken from APD2 tax returns from registered APD taxpayers which are taken from ETMP via the Enterprise Data Hub (EDH).

3.2 Frequency of data collection

The data for APD receipts are downloaded every month into databases for analysis and the data for APD liabilities are downloaded every 12 months for analysis in the APD Bulletin.

3.3 Data collection

Data on APD receipts are sourced from ETMP. This data is downloaded every month from the system and collated in internal files. Collection is part of the team’s normal administrative procedures.

Data on APD liabilities are sourced from APD2 tax returns via ETMP. This is downloaded from EDH and processed using the software package R. Any code is thoroughly checked and quality assured.

Data is sense checked and checked against previous months and years for differing trends. Any unexpected trends are thoroughly investigated and explained.

3.4 Data validation

Source data is checked against the previous release for any revisions every release and any revisions are clearly marked.

Statistics are sense checked after compilation to ensure there are no mistakes or unexplained outliers.

Data may be compared to external or public sources to validate that trends are consistent.

3.5 Data compilation

Data for APD receipts and liabilities are sourced from ETMP, receipts are taken directly from ETMP, liabilities are taken from EDH using the software package R. Liabilities data is aggregated using R and combined with receipts data on a monthly basis. The aggregated data is analysed during the data compilation and sense checked to ensure accuracy.

3.6 Adjustment

No significant adjustment takes place within the APD bulletin.

4. Quality Management

4.1 Quality assurance

All official statistics produced by KAI must meet the standards in the Code of Practice for Statistics produced by the UK Statistics Authority and all analysts adhere to best practice as set out in the ‘Quality’ pillar.

Analytical Quality Assurance describes the arrangements and procedures put in place to ensure analytical outputs are error free and fit-for-purpose. It is an essential part of KAI’s way of working as the complexity of our work and the speed at which we are asked to provide advice means there is a high risk of error which can have serious consequences on KAI’s and HMRC’s reputation, decisions, and in turn on peoples’ lives.

Every piece of analysis is unique, and as a result there is no single quality assurance (QA) checklist that contains all the QA tasks needed for every project. Nonetheless, analysts in KAI use a checklist that summarises the key QA tasks, and is used as a starting point for teams when they are considering what QA actions to undertake.

Teams amend and adapt it as they see fit, to take account of the level of risk associated with their analysis, and the different QA tasks that are relevant to the work.

At the start of a project, during the planning stage, analysts and managers make a risk-based decision on what level of QA is required.

Analysts and managers construct a plan for all the QA tasks that will need to be completed, along with documentation on how each of those tasks are to be carried out, and turn this list into a QA checklist specific to the project.

Analysts carry out the QA tasks, update the checklist, and pass onto the Senior Responsible Officer for review and eventual sign off.

4.2 Quality assessment

The QA for this project adhered to the framework described in ‘4.1 Quality assurance’ and the specific procedures undertaken were as follows:

Stage 1 – Specifying the question

Up to date documentation was agreed with stakeholders setting out outputs needed and by when; how the outputs will be used; and all the parameters required for the analysis.

Stage 2 – Developing the methodology

Methodology was agreed and developed in collaboration with stakeholders and others with relevant expertise, ensuring it was fit for purpose and would deliver the required outputs.

Stage 3 – Building and populating a model/piece of code

The bulletin was quality assessed as follows:

• analysis was produced using the most appropriate software and in line with good practice guidance

• data inputs were checked to ensure they were fit-for-purpose by reviewing available documentation and, where possible, through direct contact with data suppliers

• QA of the input data was carried out

• the analysis was audited by someone other than the lead analyst – checking code and methodology

Stage 4 – Running and testing the model/code

The bulletin was quality assessed as follows:

• results were compared with those produced in previous years and differences understood and determined to be genuine

• results were determined to be explainable and in line with expectations

Stage 5 – Drafting the final output

The final outputs were quality assessed as follows:

• checks were completed to ensure internal consistency (e.g. totals equal the sum of the components)

• the final outputs were independently proofread and checked

5. Relevance

5.1 User needs

This analysis is likely to be of interest to users under the following broad headings:

• national government – policy makers and MPs

• regional and local governments

• academia and research bodies

• media

• industry stakeholders

• general public

5.2 User satisfaction

The demand for the APD Bulletin is measured by the number of unique page views which represents the number of visits during which the page was viewed at least once. Within the financial year ending in 2021, there were 335 unique page views.

Over time the APD Bulletin has evolved as a result of information found out through consultations and surveys:

• There was a user engagement survey in 2010 which led to some changes to the bulletin (for example consolidating into one bulletin and including historical data)

• Following this and the 2012 UKSA report, further changes were made to the bulletin, which included added commentary, graphs and background information

• In 2016, the frequency of the bulletin was then altered from quarterly to bi-annually as a result of a consultation

The APD Bulletin was up for consultation in the 2021 survey and as a result will be published annually in June from June 2022.

5.3 Completeness

It is a legal requirement that all businesses are regulated and submit the relevant returns required. Penalties exist for non-compliance. The statistics contained in this report can therefore be considered as complete.

HMRC report estimates of the tax gap across all taxes and duties annually.

6. Accuracy and reliability

6.1 Overall accuracy

This bulletin is based on administrative data, and accuracy is addressed by eliminating non-sampling errors as much as possible through adherence to the quality assurance framework. The nature of the administrative data used may mean some errors exist in the recorded figures which would impact the accuracy of production estimates.

The potential sources of error include:

• companies entering incorrect information onto return forms

• human or software error when entering the data into systems

• companies not completing their returns by the required date

• mistakes in the programming code used to analyse the data and produce the statistics

6.2 Sampling error

No sampling takes place within the APD bulletin.

6.3 Non-sampling error

Coverage error

The data used to produce these publications is exhaustive, and covers all APD due under UK jurisdiction. This means that data on liabilities and receipts refers to all APD dutied legally. Coverage error is therefore not relevant.

Measurement error

The main sources of measurement error could be categorised as respondent errors and include the following:

• companies may make errors entering their information onto return forms, whether this is done on paper or electronically

• company tax return data is subsequently entered onto HMRC systems either manually or by electronic transmission, which is another point at which data may be altered due to human or software error

Nonresponse error

The APD bulletin is routine administrative data based on receipts and liabilities that must be submitted, therefore nonresponse error is not relevant.

Processing error

It is possible that errors exist in the programming code used to analyse the data and produce the statistics. This risk is reduced through developing a good understanding of the code and thoroughly reviewing and testing the programs that are used.

6.4 Data revision

Deferments and late returns can influence the data used for the publications. For that reason, the last 12 months of data at any given time are labelled as ‘provisional’, although revisions tend to be minor. Where there are revisions they are clearly marked as ‘revised’, and information is given as to the reasons and scale of the revisions if appropriate.

Every 12 months on release of a new publication, previous data is reviewed and any revisions required are made. If revised data was not previously marked as provisional it is clearly highlighted in the statistics with a ‘[revised]’ markup within the statistical tables.

Planned revisions occur with the release of the annual receipts publication. This alignment occurs every March and involves the previous financial year. Receipts are considered provisional until the publication is released.

The United Kingdom Statistics Authority (UKSA) Code of Practice for Official Statistics requires all producers of Official Statistics to publish transparent guidance on the policy for revisions.

6.5 Seasonal adjustment

No seasonal adjustment occurs within the APD bulletin and is therefore not relevant to the publication.

7. Timeliness and punctuality

7.1 Timeliness

The bulletin is published one month after the end of the reporting period for receipts. That is, the bulletin relating to APD received in January is published at the end of February. The bulletin takes around one week to produce, with the data not being available until after the middle of the month. The remaining time is spent quality assuring the information in the bulletin.

7.2 Punctuality

In accordance with the Code of Practice for official statistics, the exact date of publication will be given not less than one calendar month before publication on both the Schedule of updates for HMRC’s statistics and the Research and statistics calendar of GOV.UK.

Any delays to the publication date will be announced on the HMRC National Statistics website.

The full publication calendar can be found on both the Schedule of updates for HMRC’s statistics and the Research and statistics calendar of GOV.UK.

There have been no incidents of late publication of the bulletin since the [previous New Taxes Bulletins Quality Report was produced in 2013(/government/uploads/system/uploads/attachment_data/file/256383/new-taxes.pdf).

8. Coherence and comparability

8.1 Comparability over time

The classification of passenger numbers by European Economic Area (EEA) and non-EEA destinations was replaced by destination band on 1 November 2009, so data before and after this date is difficult to compare.

From April 2015 Bands C and D were merged into Band B meaning that Band C and D receipts and liabilities are not available for comparison after April 2015.

8.2 Coherence – cross domain

No known issues regarding coherence between domains.

Coherence – sub-annual and annual statistics

No known issues regarding coherence between sub-annual and annual statistics.

Coherence – national accounts

The statistics are coherent with the national accounts framework, but users should note that APD revenue is reported on a cash basis by HM Revenue and Customs (HMRC), i.e., when cash payments are received, but within some national accounts publications, such as the Office of National Statistics Public Sector Finances publication, APD revenue is published on an accrued basis, i.e., when tax liability was accrued by taxpayers.

8.3 Coherence – internal

No known issues regarding coherence between internal datasets.

9. Accessibility and clarity

9.1 News release

Link all press releases linked to the data over the past year.

9.2 Publication

The data is publicly available within the APD Bulletin and is published at 9:30 am on the pre-announced date of release.

The data is publicly available within the APD Bulletin and is published at 9.30 am on the pre-announced date of release.

The APD Bulletin commentary is published in accessible Hypertext Markup Language (HTML) format, as generated within internal UK government HTML Markdown software. The APD Bulletin data tables which accompany the commentary are published in accessible Open Document Spreadsheet (ODS) format.

Accompanying the bulletin is a background and references document which includes:

• definition for APD

• details on how APD is levied and paid

• methodology for producing APD statistics

• statistical quality information, including HMRC’s rounding policy

• hyperlinks to relevant pages where bulletin users can find more information

There is also an historic APD rates document.

Both historic duty rates and background and references are published in HTML format.

Following major changes in September 2020, substantial formatting changes were made to the APD Bulletin to ensure alignment with accessibility regulations for digital content from public bodies as legislated within the Public Sector Bodies (Websites and Mobile Applications) (No. 2) Accessibility Regulations 2018.

This reformatting of the APD Bulletin formed part of HMRC’s wider accessible documents policy. Changes made to the APD Bulletin included:

• replacement of Portable Document Format (PDF) files previously used for statistics commentary with HTML documents for the same purpose

• migration of all APD duties background, references and rates information from Microsoft Excel tables to HTML documents

• migration of data tables from Microsoft Excel to ODS format

• simplification of language used to avoid jargon and clear explanations used to describe all non-decorative features

An accessibility report was first produced to identify required format changes. The overriding aim of this reformat was to improve how perceivable, operable, understandable and robust the APD Bulletin is for all users, in line with the Web Content Accessibility Guidelines (WCAG 2.1) design principles for accessibility.

9.3 Online databases

This analysis is not used in any online databases.

9.4 Micro-data access

Access to this data is not possible in micro-data form, due to HMRC’s responsibilities around maintaining confidentiality of taxpayer information.

9.5 Other

There aren’t any other dissemination formats available for this analysis.

9.6 Documentation on methodology

Background and references to the APD bulletin is publicly available to users within the APD Bulletin.

9.7 Quality documentation

All official statistics produced by KAI, must meet the standards in the Code of Practice for Statistics produced by the UK Statistics Authority and all analysts adhere to best practice as set out in the ‘Quality’ pillar.

Information about quality procedures for this analysis can be found in section 4 of this document.

10. Cost and burden

The annual update to the APD Bulletin takes up to 4 working days in total for the main analyst to complete and receive QA from other analysts, the team leader, and the person signing off the release. The annual cost, therefore, is around 4 days a year.

There is no respondent burden since the data is taken from administrative sources which are used by taxpayers to make their usual returns to HMRC.

11. Confidentiality

11.1 Confidentiality – policy

HMRC has a legal duty to maintain the confidentiality of taxpayer information.

Section 18(1) of the Commissioners for Revenue and Customs Act 2005 (CRCA) sets out our duty of confidentiality.

This analysis complies with this requirement.

11.2 Confidentiality – data treatment

Before going live, the bulletin is classified as pre-released National Statistics, and is therefore subject to a restricted protective marking when referred to in email correspondence and is subject to the Code of Practice for Official Statistics, which is strictly enforced.