Flying business class? Get ready to pay the ‘Lewis Hamilton’ levy
A “LEWIS HAMILTON tax” will mean business class fliers and the owners of private jets face increases in the cost of travel to pay for a freeze in Air Passenger Duty (APD) for those travelling in economy.
Philip Hammond announced that as of April 2019, the rates of APD applied to short-haul flights would be frozen, along with those applied to long-haul economy flights.
The Chancellor said keeping the rates the same would be paid for by increasing the levy applied to premium class long-haul tickets and to travel on private jets.
Campaigners bemoaned this as a “missed opportunity” to cut APD rates and bring them into line with taxes charged by other European countries. Mr Hammond singled out Mr Hamilton, the Formula 1 world champion who hit the headlines at the start of this month over claims that he “avoided” tax on his own jet, as he announced the measures.
Meanwhile, the Chancellor also confirmed that a railcard for young people would be extended so that it applied to adults aged 26-30 to entitle them to cheaper train tickets.
The measure will be seen as a direct attempt by the Government to appeal to younger voters who flocked to Jeremy Corbyn at the last general election and helped Labour to a better-than-expected set of results.
The Government has faced persistent pressure to slash APD, with analysis released in September suggesting that business class fliers in Britain are paying millions of pounds more in the tax than their European counterparts.
Mr Hammond ultimately refused to cut the tax but insisted his decision to maintain APD at its current rate for the majority of passengers would help British families.
Reports at the start of November claimed that Mr Hamilton had “avoided” tax on his private jet with the leaked “Paradise Papers” apparently showing that he received a £3.3 million VAT refund on his £16.5 million Bombardier Challenger 605 plane.