Simon Calder gives verdict on new air passenger duty and reveals how to avoid it
Flight tax for all but the cheapest seats on planes is set to rise by above inflation
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Your support makes all the difference.The chancellor has announced another increase in air passenger duty (APD). This is the tax that passengers aged 16 and over must pay when flying from most UK airports.
For the tax year 2025-26, APD will rise by predicted inflation for those in the cheapest seats – but by more than that in anything other than basic economy.
Air passenger duty is seen as a perfect tax by politicians. It is difficult to avoid and easy to collect, because airlines do all the work and send the Treasury a cheque.
APD is unique to the UK, and a topic of much controversy:
- Is it a “green” tax or simply a revenue-raising device?
- Does it encourage less damaging behaviour by travellers or inadvertently cause more harm?
- Should it be eliminated or sharply increased?
The debate is set to intensify, along with an increasing number of travellers avoiding APD through a variety of means.
These are the key questions and answers.
A brief history of air passenger duty
The man responsible for APD was the last Conservative chancellor of the 20th century, Kenneth Clarke. He told me: “Aviation was in an unusual position in that it’s the only form of transport where no one was paying any tax on the fuel that it uses.
“For years and years governments have regarded it as totally normal to impose tax on petrol, diesel fuel and everything used by land and sea. For historic reasons nobody was placing any tax on air fares.
“For me that was an anomaly, not least because people who use aviation tend to be slightly more prosperous than those who use other forms of transport.”
As international aviation agreements generally rule out a tax on jet kerosene, Mr Clarke instead imposed air passenger duty of £5 on each European flight, and £10 on long-haul services. It applied to all passengers above one year of age starting a journey at a UK airport, and took effect in 1994 – just a year before easyJet started flying.
What has happened since?
Mostly, it has increased – partly because It can be presented as a “green” initiative, dampening demand for aviation. And many of the people who pay it are foreign visitors and do not vote in the UK.
The next chancellor, Gordon Brown, doubled the tax for business- and first-class seats. (One bizarre loophole, since closed, meant that passengers on the world’s most expensive aircraft, Concorde, paid the same as budget airline travellers to Morocco.)
Since 2016, APD no longer applies to under 16s travelling in basic economy – but it is payable for higher classes.
In 2023, Rishi Sunak halved air passenger duty on domestic flights, encouraging a move from rail, sea and road to air for journeys within the UK. But in the 2024 spring Budget, Jeremy Hunt said it would rise.
How is air passenger duty calculated?
The rate depends on two factors: the traveller’s final ticketed destination and the class of travel.
The “final ticketed destination” is important. If you are travelling on a “through ticket,” eg. Manchester-Amsterdam-Hong Kong or Birmingham-Frankfurt-Mumbai, the long-haul rate applies (unless you are spending over 24 hours at the transit point).
For the class of travel: in anything but basic economy, a higher rate is payable – and all passengers aged two or over must pay it.
Passengers on private jets pay a vast amount more.
In terms of destinations, there are four different categories: UK domestic flights, plus three classes for international travel.
- Band A: Destinations abroad whose capital city is 2,000 miles or less from London. This covers all of Europe and parts of North Africa
- Band B: Destinations whose capital city is 2,001-5,500 miles from London
- Band C: Destinations whose capital city is over 5,500 miles from London
What are the rates?
From 1 April 2024, they are as follows:
- UK domestic £7 or £14
- Band A £13 or £26
- Band B £88 or £194
- Band C £92 or £202
For private jets, the tax is between £78 and £607 per person.
How does the tax burden work out for a family?
For a family of four (with children between two and 15), the total APD is as follows:
- UK: £14 in basic economy, £56 in premium economy or better.
- Europe: £26 or £104.
- Most long-haul destinations: £176 or £736.
- Very long-haul destinations: £184 or £808.
Listen to Simon Calder’s podcast on air passenger duty
How can I avoid APD?
These are some of the tax-avoiding options:
1. Don’t fly.
2. Be under 16 and travel in basic economy (or under two in business class)
3. Fly into the UK on one plane and out within 24 hours on another and have them both included in the same ticket.
4. Be a pilot or member of cabin crew on duty.
5. Be repatriated after being refused admission to the UK.
6. Fly on a route from a UK airport that is not subject to air passenger duty.
I can’t manage 1, 2, 3, 4 or 5 right now, but how do I find an APD-free flight?
Fly from the Scottish Highlands and Islands Region, which includes Orkney, Shetland, the Western Isles, Oban, Campbeltown and Inverness.
Remarkably, even if you are fly from Inverness to London Heathrow and onwards to a long-haul destination, the tax saving applies. Flying from Aberdeen to New York on British Airways in late November, for example, costs £392 return – but from Inverness the fare is just £316, saving one-fifth on the trip.
Long-haul flights from Belfast are also free of tax.
To be kinder to the planet, you could travel terrestrially to a foreign airport: by sea (or overland from Northern Ireland) to Dublin; by sea to the Netherlands; or on a Eurostar train to Paris, Brussels or Amsterdam.
How can I reduce APD?
You could fly to Amsterdam, Paris, Dublin or any other European airport and buy a separate ticket from there. For transatlantic flights, there is an extra benefit of travelling via the Irish capital: you complete US arrival formalities while at Dublin airport.
But you will assume the risk of a misconnection, and furthermore because the UK is so competitive for air fares, you may not save money.
A smarter way to do it is to build in a stopover of 24 hours or more at the connecting point. The airline should automatically charge you the lower rate. In effect, since you are saving £65, the chancellor is paying for a short break for you.
Reykjavik and Istanbul are particularly good for North America and Asia/Africa respectively.
What if I fly in economy on the first leg but business for the rest?
If you are on a through ticket, the business-class rate applies to the whole journey.
If I book a flight and don’t show up for it, who gets the tax?
The airline. While carriers collect APD up to a year in advance, the obligation to pass it on to the government crystallises only when the passenger flies. In theory you can claim it back, but in practice some airlines and travel agents impose fees that are designed to render attempts pointless – with a handling fee the same or more than the tax refund.
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