Treasury is against devolving air tax

THE Treasury has said it does not intend to devolve air passenger duty to Wales as it could give Cardiff Airport an unfair advantage over Bristol.

A meeting of the Welsh Affairs Committee was told devolution of air passenger duty (APD) could allow the Welsh Government to scrap the tax, giving Cardiff Airport a competitive edge.

Bristol Airport CEO Dave Lees told ministers more than a million passengers a year could choose to fly from Cardiff instead. He said an airline had told him it would move to Cardiff straight away if the tax was lower.

The Treasury has said it did not intend to devolve APD to Wales.

In a statement it has said: “The government remains concerned about the impact of any devolution to Wales on English airports, particular Bristol Airport which exists in a single aviation market with the largest commercial airport in Wales, Cardiff.

“... we do not believe that the devolution of APD to the Welsh Assembly is the right course of action.”

The Welsh Government, which has owned Cardiff Airport since 2013, has been asking for control of the tax for years.

Flight duty has already been devolved to Scotland and for long-haul flights from Northern Ireland.

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Bristol Airport fears losing

But the Treasury has continuously refused, claiming the move would provide Cardiff with an advantage over their English competitors.

Asked if devolution of the tax would result in a “threat” to Bristol Airport’s plans to expand, Mr Lees told the committee meeting in Cardiff on Thursday: “It certainly would have a material impact in terms of the number of passengers carried because of the overlap of the catchment area.”

He added: “I spoke to one of our key airlines yesterday and they said they would move capacity from Bristol to Cardiff very quickly, this isn’t long-term, this is an immediate impact.”

Cardiff Airport CEO Debra Barber insisted there would be enough passengers to provide custom to both airports.

She said: “For us we think Cardiff would gain initially between 100,000-400,000 with a maximum of 600,000 by 2025.”

She added: “There would be a material economic benefit for south Wales.”