High Court backs 'green' air tax

A judge ruled that Air Passenger Duty (APD), which currently brings in some £2 billion a year, was lawful and justified "as a proportional measure" aimed at reducing damage to the environment.

Mr Justice Stanley Burnton, sitting at London's High Court, rejected a legal challenge brought by the Federation of Tour Operators (FTO) and two of its member companies - Tui UK Ltd and Kuoni Travel Ltd.

FTO cast doubt on whether APD was for the benefit of the environment and described it as "greenwash" and "the stealth tax of the skies"

The Federation applied for judicial review after Gordon Brown doubled APD in February this year, leaving holiday companies with a "shock" bill of some £50 million related to existing bookings, which, unlike airlines, they could not pass on to customers because of package travel regulations.

Tour operators complained that they had not been given proper notice of the increase and should have been granted an exemption on existing bookings as the Treasury had overlooked or ignored the effect of the regulations on their industry.

The judge said that anyone reading between the lines of his judgment would see that he had "some sympathy" for the tour operators.

He criticised the "decision-making process" of the Treasury, saying the relevant regulations had been ignored - but there was no legal basis for the High Court to intervene.

The regulations and their effect had eventually been "emphatically" brought to the Government's attention by the FTO and others, and the decision to impose the increase on tour operators had been made nevertheless, said the judge.

The FTO was refused permission to appeal, but can still ask the Court of Appeal directly to consider its case. It said in a statement that it was "disappointed" with the outcome of its application.