Member Article

Government should rethink Air Passenger Duty says NECC

The North East Chamber of Commerce (NECC) has called on the Government to rethink Air Passenger Duty (APD) or the region’s exports could suffer.

The Organisation is calling for the Government to overhaul its current system, which it claims is having a disproportionate impact on the region’s businesses.

NECC believes that differential rates for regional airports, in place of the current ‘blanket’ duty, will ensure that the North East economy does not suffer and that its export businesses can continue to grow.

James Ramsbotham, chief executive of NECC, said: “The North East has a strong track record in exporting and we believe that growing this through a reform of APD could hold the key to the region’s long-term economic prosperity.

“The Government has spoken of a commitment to rebalance the economy and NECC believes that in order to do this, there must be a conscious effort to bolster the North East’s international trading capacity through policy that supports exporters.

“ North East businesses already face heavier costs than their counterparts in other regions in order to access common markets due to high fuel prices, so addressing the anomalies that APD gives rise to will ensure that our exporting businesses have a much better chance of realising their potential.“

In a letter to Transport Secretary, Phillip Hammond MP, NECC outlines the affect that the current system is having on the region’s businesses.

It claims that APD has a greater impact on connections to regional airports because these flights carry fewer passengers and have less elastic demand than major hubs.

It is thought that the duty is putting airlines off introducing new connections to key international markets from the North East, making it more difficult for regional businesses to trade overseas.

He added: “Connections, such as those provided by Emirates from Newcastle International Airport, give our businesses easy access to key international markets.

“APD is placing increased pressure on these services, and is stifling the growth of new routes – which in turn would stimulate the growth of the North East export market.”

This was posted in Bdaily's Members' News section by Ruth Mitchell .