Cut NI air passenger tax to grow economy say MPs

The Northern Ireland Affairs Committee has issued a report that recommends getting rid of air passenger duty (APD) from all flights departing from the country. It believes the move is required to prevent a potential fallout in the economy after Continental Airlines threatened to stop Northern Ireland's only transatlantic route if the duty was not reduced.

In an argument echoing the debate over whether to cut the rate of corporation tax in Northern Ireland, there are concerns that the airline could move the route from Belfast to down South where the tax will soon be abolished altogether. The duty in the Northern Ireland currently results in an additional £60 being added to every flight leaving Belfast for the US, and executives from Continental have told MPs that it could no longer justify the £3.2million a year paid in departure tax, when they could soon operate the flights out of the Republic of Ireland at no cost whatsoever.

The report highlights the importance of the only transatlantic route to the Northern Ireland economy, saying that if it were lost, the business connections between the county and the US could follow. It recognises that the current duty in the South of 3 Euros, which is expected to be abolished altogether, makes moving the route down South an attractive option for the airline. Airlines have been quick to support the proposed cut, as was chief executive of the George Best Belfast City Airport, Brian Ambrose, who says that a cut would create "a level playing field to eliminate unfairness and disadvantage."

A spokesman for the Treasury said that the government "welcomes the report" and that a response will be provided "in the autumn".

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