Tuesday, 15 March 2011

Tax cuts for the most under-taxed??!!

I was amazed to find Jerry Blackett calling for airport taxes to be cut in the Birmingham Post on March 14. How unfortunate it is that at a time when people are losing their jobs and facing tax rises on everyday items he should be defending the already under-taxed aviation industry.

The figures he quotes for losses to the economy are dwarfed by the subsidies the aviation industry already receives and the money that is taken out of the economy by people flying abroad.

VAT has just gone up to 20%, as people must be very aware, yet how much VAT does the aviation industry pay? None on anything! They don't pay VAT or any other tax on fuel, they pay no VAT on buying aircraft, servicing of those aircraft or meals served on aircraft. With this lack of taxation, public money being proposed to be put into paying for Birmingham Airport's runway extension and no suggestion that the industry is liable for the environmental damage it causes, in fact they get a very good deal indeed.

Compared to car travel, aviation benefits from an annual tax subsidy of around £9 billion and how many people actually benefit from this? The country suffered from an annual tourism deficit of over £15bn in 2009, down significantly due to the recession. Perhaps a further adjustment is needed for people to spend more money in this country and bring more money into the treasury.

At a time when people are losing their jobs because of cuts to public services, we should not be giving any further money to activities that benefit so few people. The majority of people don't fly and would rather that those who do pay their fair share of tax.

See Fair Tax on Flying for more info

Joe Peacock

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