On Thursday 1st November the Conservative MPs Priti Patel and Henry Smith brought forward a motion in the House of Commons seeking the Government to commission a comprehensive study into the full economic impact of APD in the UK and to report back on the effects. The motion was passed.
I managed to speak in the debate.
All tax has a punitive element, and 2 and half years into this job has taught me that everyone would like to pay less tax both personally and from a business point of view. But everyone also does recognise that tax taken by the government is then spent on the public services we all so value - from schools, hospitals, police and so many more things. APD is a significant tax on flying that has been used by this Government and the previous Government. The money raised is used to reduce the deficit and pay back this country’s debts, which we inherited, and which everyone knows are significant. The argument that is going on in parliament is essentially twofold:
- one, whether the reduction of this tax would actually produce greater tax revenue / growth in the economy.
- two, whether there is a way to make the APD fairer amongst the UK as a whole - whereby one possibility is that the regions get a lesser rate as compared to London and the South East. The point I made in the debate is that “a change to the regional APD would make a huge difference to regions such as the North East”.
I do not think this tax will change in the short term but it is one of the potential tax regimes that is open to reform in the medium term, particularly as the economy recovers.To see the full debate go to the following link: http://www.publications.parliament.uk/pa/cm201213/cmhansrd/cm121101/debtext/121101-0003.htm#12110129000004