Budget 2017. Air Passenger Duty up again.

Today, the Chancellor of the Exchequer delivered his budget.  I’m not going to comment on any of it (at the risk of getting political) except for bringing news about a further increase to Air Passenger Duty.

Air Passenger Duty is a tax on all departures from the UK by air, with a number of notable exceptions which I’ll delve into later.

It’s part of the taxes, fees and charges element of all tickets booked starting in the UK, whether it’s a revenue ticket or one paid for using miles.

There are two different rates depending on your class of travel, and there are two different rates depending on how far you’re travelling; either under or over 2,000 miles.  There’s also a rate for private jets, but I’m not going to cover that here.

For departures up to 31st March 2018 the tax looks like this:

Economy Premium Cabins
Under 2,000 miles £13 £26
Over 2,000 miles £75 £150

Today the Chancellor announced the following:

Air Passenger Duty (APD) – Short-haul APD rates for 2019-20 will remain frozen as they have been since 2012. The long-haul rate for economy passengers will be frozen at the 2018-19 rates while the rates for premium economy, business and first class will increase by £16 and for those travelling by private jet by £47.

The rates from 1st April 2018 looked like this:

Economy Premium Cabins
Under 2,000 miles £13 £26
Over 2,000 miles £78 £156
+ £16 announced today
£172

That takes us to a whopping £172 in taxes to the exchequer just to fly long-haul in a premium cabin departing from the UK.  That’s in addition to all of the airline’s “carrier imposed surcharges” née fuel surcharges.

So how do you get around it?

If you want to fly non-stop from somewhere like London or Manchester, then in short, you can’t.

However departures from various Scottish cities are exempt from APD, notably Inverness (useful as it has direct flights to London).  In addition, departures from Jersey and the Isle of Man are also exempt.  Also, if you’re departing from somewhere in Europe and connecting in London then you don’t have to pay APD as long as you’re on a single ticket.

Connecting is a very specific term and quite helpfully means arriving and departing in under 24 hours.

For example, on a Tuesday, I could fly from Jersey to London on BA2777 arriving at Gatwick at 21.05.  I would have until 21.04 the next day to get any flight leaving the UK and not have to pay APD.

This is particularly useful on long-haul redemptions using Avios as British Airways give you a free domestic tag on for the same number of Avios.

So I could fly Jersey to Gatwick on a Tuesday, and then the next day fly from Heathrow to New York and I would pay the same number of Avios, and not pay any APD at all.  On the return flight, I simply need to end my journey in London; there’s no need to return to Jersey.

This means that as long as I can get out to somewhere like Jersey (or Inverness) for under £172 I am saving money.  This could equally apply to flights from Dublin, from Paris, from Amsterdam or wherever.  As long as my positioning costs are under that amount which is now quite substantial, you’d be up.

If there’s more than one of you travelling then the savings mount up as well.  From a quick look at BA’s low fare finder, they have seats as cheap as £48 one way from Gatwick to Jersey with very wide availability.  That represents a saving of £124 per person or almost £250 for a couple using a British Airways American Express 2 for 1 voucher – that’s a considerable chunk of change and well worth considering despite the hassle factor.

So in short, if you’ve got time and you can find the availability which can be pretty good, then do look at starting from somewhere other than London or Manchester.  You could save a fair amount of cash.

Finally, what also may be of interest is this article that I wrote a few weeks ago, which goes into more detail on the logistics of both booking and travelling on these type of bookings.

2 comments

  1. In your Jersey to New York example, can you book it to be just JER-LGW LHR-JFK-LHR and still pay the lower APD because it’s based on your departure not your round trip?

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