What a difference a letter makes!
With the letter “A” in front, it’s “an alliance of over 30 airlines, airports, tour operators, destinations and travel trade associations calling on the Government to make UK aviation tax fairer“, i.e. the aviation industry calling for even more tax breaks. Click their logo to see their Facebook page.
Without the letter “A” in front, it’s a group dedicated to “publicising aviation’s REAL tax situation”, i.e. pointing out how much we’re all feather-bedding the aviation industry. Click their logo to see their Facebook page. Here’s what they have to say:
Airlines pay no tax on aircraft fuel
Motorists pay 59p a litre in fuel duty + VAT at 20%. Thus petrol tax is at a rate of approx 160%. Tax on aviation fuel is 0%.
Airlines pay no VAT
- There is no VAT on airline tickets.
- There is no VAT on the purchase of aircraft.
Motorists pay VAT at 20% on the purchase of cars.
- There is no VAT on the servicing of aircraft.
Motorists pay VAT at 20% on the servicing of their cars.
- There is no VAT on goods sold in airport duty-free shops or on meals served on aircraft.
Motorists pay VAT on most goods and meals in motorway cafés.
Airports pay no tax on alcohol and tobacco
No tax is paid on drink and tobacco sold in airport duty-free shops. Tax on a bottle of whisky in the High Street is £6.66. Tax on cigarettes in the local shop is about 80%.
Airlines do pay air passenger duty
The total revenue from air passenger duty in 2011-12 is forecast at £3 billion.
The Treasury estimated in October 2009 that the loss of revenue as a result of no fuel tax and no VAT on airlines was at least £10 billion a year. With the increase in fuel tax and VAT since then, the figure must now be around £12 billion.
To achieve fair tax with motorists, air passenger duty would need to be quadrupled!
Thus, compared to car travel, air travel benefits from an annual tax subsidy of around £9 billion.