Public Services Lose out in Plane Insanity

14th November 2003
news
release

The government is likely to publish its aviation White Paper in December this year. Manchester Friends of the Earth [1] are calling for the public to urge their MPs to sign the Early Day Motion 1688 [2] by 20th November this year. This Early Day Motion would stop the aviation industry getting away with not paying over 9 billion pounds of tax [3].

This money, the campaigners are arguing, would be better spent improving buses and trains and other public services. Taxation, as the Treasury admits [4], would also be a leverage to reducing climate change emissions from the industry.

It seems clear that the Government supports more air travel growth and meeting predicted demand will require the equivalent of a new airport the current size of Stansted every year for the next 30 years. Yet no new runways or airports, or the noise and pollution that accompanies them, would be needed if the aviation industry did not receive an astonishing tax break.

Until 20 November readers can go to www.manchesterfoe.org.uk/planetruth to download a letter to send to their MP. This asks them to sign the Early Day Motion.

Kerstin Moritz of Manchester Friends of the Earth says:

“Because of the huge tax breaks given to the aviation industry the North West is potentially missing out on over £1 billion each year. This would pay for about 21,000 additional teachers, nurses or policemen – Manchester Airport does not even employ so many people!”

ENDS

Notes to Editors

[1] Manchester Friends of the Earth is a prominent pressure group, raising awareness and lobbying for policy changes at a local, regional, national and international level. The group consists entirely of volunteers, and its campaigns are funded by membership fees and individual donations. The group organisation recently won the national ‘Earth Movers’ award for its work with communities in the Longsight area of Manchester. Up-to-date information is available on their website: https://www.manchesterfoe.org.uk. Manchester Friends of the Earth is part of a national network of local groups, affiliated to the national organisation (further information can be found at http://www.foe.co.uk).

[2] Link: http://edm.ais.co.uk/weblink/html/motion.html/ref=1688

[3] There is no tax on fuel, no VAT, and duty-free sales continue except for trips entirely within the EU.

£billion
per year
5.7 Fuel tax @ 45.8p per litre (the same rate as applied to car fuel)
4.0 VAT
0.4 Duty free
-0.9 Deduct Airport Departure Tax (currently £5 or £10 per ticket)
9.2 Net tax subsidy

The DfT’s SPASM computer model is used to assess transport demand and was the basis for the Government’s airport expansion proposals announced last July. At the request of CPRE, AEF and Friends of the Earth, the DfT carried out new runs on SPASM to test different assumptions from those used by DfT officials. The new assumptions include that by the year 2030 aviation fuel will be taxed at the same rate as motor vehicle fuel (45.8p per litre), and that air travel will be subject to VAT. The new prediction is that the number of passengers using UK airports would rise from 180 million a year in 2000 to 315 million a year in 2030 (instead of the official forecast figure of 501 million passengers. On that basis there would be no need to build any new runways.

[4] The Guardian 28 October 2003