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Airlines set to sue Treasury over passenger tax
Last updated at 23:52pm on 15.12.06
Gordon Brown announced the doubling of Air Passenger Duty in a pre-Budget report last week
Britain's major airlines and travel operators are preparing to sue Gordon Brown over his controversial 'stealth tax' on air travel which threatens to create chaos at airport check-in desks from February 1.
They are to talking to lawyers with a view to mounting a legal challenge against his decision to backdate a doubling of the 'air-tax' paid by travellers - which they believe to be illegal.
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Hard-working families who have already booked tickets to take their children abroad in the February half-term holiday or at Easter or on ski-ing trips now face handing over hundreds of pounds in extra 'air tax' at check-in.
With airports already creaking at the seams from additional anti-terror security measures, passengers, families and holidaymakers will face massive delays as check-in staff work as 'unofficial tax-collectors', warn industry leaders.
The row erupted after the Daily Mail revealed last Friday that millions of families who have already paid for holidays next year will be hit by the Chancellor's rise in air tax aimed at putting an extra £1bn a year into Treasury coffers.
The Chancellor announced in his pre-Budget statement last Wednesday that air passenger duty would double from February 1.
But crucially the tax will apply when passengers fly - not when they book their tickets.
This 'backdating' affects more than 10 million passengers - UK and foreign - who have already bought tickets at the existing air tax rate - to fly out of the UK on or after February 1.
The backdating alone will add another £100 million, travel companies have calculated.
The Federation of Tour Operators which is party to the planned action said last night (FRI): "There will be chaos. We are seeking legal advice over the Chancellor's decision to backdate this tax to people who have already booked. We believe it to be illegal and are looking to mount a challenge. We are taking legal advice."
The spokesman added:"You can imaging the scenes if he doesn't relent. Mr Brown is asking check-in staff to become unofficial tax collectors. With all the extra security in place, it will be mayhem."
Furious travel firms have also delivered a humiliating snub to Environment Secretary David Milliband by cancelling in protest a landmark 'green' initiative they were planning to help cut harmful emissions: "We're not going to be taxed twice if they play these sort of games," said one angry executive.
And they said there would be only one person to blame for the expected meltdown - Chancellor Gordon Brown.
On Monday Chancellor Brown refused to back down on the controversial aviation 'stealth tax' hike hitting up to 10 million air passengers after his Treasury officials told airline chiefs: "We need the money."
A delegation of 15 airline bosses and travel companies met officials for an hour at the Treasury. But their pleas fell on deaf ears.
One senior aviation executive said: "If there is chaos, passengers will have only one person to blame."
A spokesman for Virgin Atlantic said: "It will lead to delays at airports up and down the country as airlines are forced to collect this extra tax on behalf of Chancellor Gordon Brown."
Roger Wiltshire of the British Air Transport Association said: "All the points we made to the Treasury fell on stony ground.
"They started their explanation on a green theme. But by the end of it they just admitted 'we need the money'."
British Airways said it was 'very disappointed' adding: "This is a retrospective tax. Quite simply, we have been told to pick up the pieces of it and the problems it is going to create."
EasyJet's boss has already accused Mr Brown of 'mugging' millions of holidaymakers. Tour operators including FirstChoice and Thomas Cook are also furious.
The doubling of the duty charged when a flight leaves a UK airport means family of five travelling to America or Africa will face an air tax - called officially Air Passenger Duty - of £200 against £100 last year as the long-haul 'cheap' rate doubles to £40 each.
If they upgrade to any other class the cost will be £400 - or £200 more than expected.
Reader views (8)
Firstly this airline tax is a complete rip off, its going to get to a stage where the average family wanting to fly either to family or Holiday, etc will be priced out, and we will get to a stage like the fiftys and sixtys where flying will be for a particular set of people. Once again its the hard working family Brit being milked. Yes we can all help to protect the environment, but its up to the airlines and those in making aircraft to deal with the pollution, many airlines are feeling the pinch when it comes to so called green issues, and the passenger tax could finish some of them. Why should we the passenger have to bail out the likes of loss making BAA ect Get rid of this tax now.
- Steve Mellor, Stevenage
Did you all vote for these comedians? This is the latest in a long long line of financial mistakes by "Robber" Brown. The hardworking family picks up the pieces of Labour's errors. It's alright for Blair with his free holidays. Only the rich will be able to afford holidays the way this is going, how very New Labour.
- Ian, Halifax, Yorkshire, UK
I just received an email saying that since I purchased a ticket after the 12th December then I am to pay tax on this - this wasn't agreed when I purchased the ticket.
Surely this is against the law? Is there a group I can contact as I think this is outrageous.
If I refuse to pay what could happen?
- Paul Jason, United Kingdom
I think it is outrageous to back-date the tax charges - if customers have already booked then the contract is for the service at the agreed price.
Now the airlines are being charged, how can some legally pass this on to the customer? If airlines are suing the Government, then should they win I will look forward to receiving a refund on the extra taxes paid plus interest.
- Jonathan, Peterborough, UK
Mr gordon Brown needs to step in our shoes, the amount of tax that we hard working people have to pay already and he wants us to pay even more for airport departure on top of the airport tax that we have to pay already is ridiculous. I am a single mother of three and I had to save up for two years to take my family on holiday just to be told I have to pay more taxes on departure.
- Karen, Newtown Birmingham
People like Gordon Brown, politicians, are just not relevant to modern life.
Gordon Brown will be the next Prime jinister... who cares?
- Willstead Ash, London UK
I have close relatives in Derbyshire, Oxford, London and south Wales. This ridiculous tax will only defer or cancel our plans for a visit to the U.K., or their plans to visit us in Canada.
We believe the departure tax (or what ever you want to call it) in Toronto, Canada is excessive. This additional tax is beyond reason. Why do air travellers have to pay much more than a fair share?
- Douglas Robinson, Whistler, BC, Canada
Excellent! I hope the airlines and tour operators successfully set a precedent, but I feel like sueing Mr Brown for all the stealth taxes he has imposed on me, as well!
- Steve R, London, UK
