New air tax delayed in ‘U-turn’ by Scottish Government

The Scottish Government has been accused of performing a U-turn over its plan to cut taxes on air travel.

Taxation powers over aviation were devolved to the Scottish Parliament in 2016 under the Scotland Act, with proposals to replace air passenger duty (APD) with an air departure tax (ADT), set at half the current rate.

Its policy has faced legal challenges, however, with EU approval needed under state aid rules to provide an exemption for the Highlands and Islands, without which, it has been argued, could hit tourism in the region.

Gaelic Holyrood speech
Kate Forbes called on the UK Government to reduce APD rates (Jane Barlow/PA)

In a written answer to the Scottish Parliament on Tuesday, Public Finance Minister Kate Forbes said that, having failed to find a solution with the UK Government, the introduction of ADT would be put back to after April 2020.

In her answer, Ms Forbes wrote: “The Scottish Government has been clear that it cannot take on ADT until a solution to these issues has been found because to do so would compromise the devolved powers and risk damage to the Highlands and Islands economy.

“Since then the Scottish Government and UK Government have continued to work together to try to find a solution.

“The Scottish Government also established a Highlands and Islands Working Group last year to provide independent, expert input into the examination of the issue.

“However, a solution has not yet been found that would be ready for introduction at the beginning of the next financial year.

“This, taken together with the continued uncertainty around Brexit, means that that we have to defer the introduction ADT beyond April 2020.”

She added: “The Scottish Government has a long-standing commitment to reduce ADT by 50% and we are doing all we can to work with airlines and airports to help grow the direct routes which are important for our tourism sector and Scottish businesses.

“While we work towards a resolution to the Highlands and Islands exemption, we continue to call on the UK Government to reduce APD rates to support connectivity and economic growth in Scotland and across the UK.”

Scottish Conservative transport spokesman Jamie Greene criticised the delay.

He said: “This is a complete shambles of a U-turn by the SNP. Despite an explicit manifesto commitment to reduce air departure tax at the last election, the Scottish Government has done everything possible to avoid honouring that promise.

“It has failed miserably to deliver this flagship policy after a dodgy budget deal with the Greens.

“A competitive ADT policy would provide a much-needed boost to a stagnant Scottish economy, improve tourism and overseas business links and offer welcome relief to hard-working Scottish families going on holiday.”

He added: “Not only is the SNP blaming Brexit for this lengthy delay, it has the brass neck to call on the UK to reduce this tax elsewhere in the UK while failing to deliver it in Scotland.

“The SNP continually calls for more and more powers to be devolved to them then asks the UK Government to either keep those powers or drags its heels to deliver them.

“Any suggestions that it supports Scottish aviation have lost all credibility after today’s announcement.”

First Minister’s Questions
Scottish Green Party co-convener Patrick Harvie says ADT is unfair and undeliverable (Jane Barlow/PA)

Scottish Greens co-convener Patrick Harvie MSP said : “The SNP’s increasingly absurd attachment to the idea of a massive tax giveaway for the airlines is unfair to the majority of people who rarely fly, out of step with climate reality and clearly undeliverable.

“They should stop pretending that it’s going to happen and instead invest in the affordable public transport that people in every community in Scotland depend on.”

Scottish Liberal Democrat energy spokesman Liam McArthur said: “While Ian Blackford joins other party leaders in meeting environmental activist Greta Thunberg, SNP ministers are sat squarely in the pocket of airline lobbyists.

“They are proposing pumping tens of thousands of tonnes of additional emissions into the atmosphere.

“Enormous tax cuts for the aviation industry will hurt our efforts to tackle climate change and leave less money available for public services. It’s time the Scottish Government abandoned this anti-environmental policy.”

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