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Passenger duty 'still stifling economy'

The report says the tax on passengers remains a stumbling block to the economy.

Passenger duty on short haul flights is a "major stumbling block" to rebalancing the economy in Northern Ireland, the NI Affairs Committee has said in a new report.

Friday, 30 November 2012
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In a report published on Friday, the body of MPs called for the government to reduce or preferably scrap the tax.

Short haul flights make up 98.5% of all flights to Northern Ireland, on which a £13 levy is currently imposed per passenger.

Currently a rate of £65 is imposed on direct flights to North America. However the devolution of power to set air passenger duty for direct long-haul flights from Northern Ireland was finalised this month and takes effect from January.

The report stresses that there is "no realistic alternatives to air travel" in the region, particularly for business travel.

It said that air connectivity, the air links to hub airports, particularly Heathrow, must be at least maintained at the current level, with the slots for flights to and from Northern Ireland at Heathrow "ring-fenced" and further routes actively sought.

It recommended for improvements to be made to road and rail links to all three of NI's airports.

A shared visit visa for the UK and Republic of Ireland was also suggested "in the interests of competitivity".

For the people of Northern Ireland air travel is not a luxury, it is fundamental to family and economic life.

Laurence Robertson, NI Affairs Committee Chair

The Committee said the business community in Northern Ireland is concerned that a report into options to maintain the UK's status as an international hub for aviation will not be completed until 2015.

It added that the government should expedite the review and come to a decision as soon as possible given its importance to Northern Ireland.

Laurence Robertson MP, Chair of the Committee, said: "To help rebalance the Northern Ireland economy, it is vital that air links to Great Britain, mainland Europe and the rest of the world are robust.

"That means making sure key routes and landing slots are protected, and that people who have no real alternatives to flying, for business or their family life, are not unfairly penalised by the taxes imposed on air travel."

NI Independent Retail Trade Association Chief Executive said addressing air passenger duty would have great benefits for the economy.

He said: "It will increase the number of visitors and ultimately the amount of spending in the local economy, so it's important that we get our passenger duty right, it's important we expand the number of our routes in Northern Ireland and I think it's about developing both our airports to their maximum potential."