APD is the highest air passenger tax in the world and together with Aberdeen and Edinburgh airports, Glasgow Airport made the case for its devolution to Holyrood to allow, in line with the Scottish Government’s commitment, for its reduction and eventual abolition.
In addition to costing Scotland over two million passengers per annum, a 2012 report, commissioned by the airports, warned that by 2016 APD will cost the Scottish economy up to £210 million in lost tourism spend per annum.
The UK Government has significantly increased rates and restructured APD since 2007. Rates for short haul travel have increased by around 160% with long haul rates increasing between 225% and 360%.
In April 2013 the Republic of Ireland scrapped its equivalent of APD entirely, leaving the UK as one of just five countries in Europe to levy a passenger departure tax. The tax raised £2.9bn for the UK Treasury in 2013-14, (approximately £200m from Scotland) however, research by PwC suggests that reducing or abolishing APD would pay for itself.
Amanda McMillan, managing director of Glasgow Airport, said: "We welcome the findings of the Smith Commission which has recommended the devolvement of Air Passenger Duty (APD) to the Scottish Parliament. APD is the highest form of aviation tax in the world and it is important it is devolved and reformed as soon as possible.
“APD is a damaging, regressive tax which in addition to dissuading airlines from adding new routes, makes it extremely challenging to maintain existing services. Having full control of APD will play a major role in strengthening Scotland's connectivity and provide yet a further boost to our burgeoning tourism industry."