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Scrapping UK air travel tax will boost economy

London - Abolishing its tax on air travel could boost Britain's economy by 1.7% by 2020, British Airways and easyJet said on Wednesday, calling on the government to go beyond recent concessions on the duty.

A study by PwC, commissioned by the airlines, found scrapping air passenger duty (APD) would lift gross domestic product by about 0.5% in the first year and by 1.7% by 2020, with tax receipts from other sources more than offsetting the revenues lost from APD.

EasyJet chief executive Carolyn McCall said in a statement: "Abolishing APD would boost the UK economy by supporting tourism, investment and business activity.

Government concession

"There is a real opportunity with this for the UK to be more competitive."

The airlines last month began to benefit from a government concession on APD with the abolition of the charge for children under 12, with plans from next year to get rid of it for all under-16s.

The calls for the government to go further and scrap the levy entirely come ahead of finance minister George Osborne's budget in July, his first since a new government was elected in May, and at a time when Britain faces the prospect of different APD regimes within its borders.


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