Northern Ireland is set for an anticipated economic boost of historic proportions with almost 40,000 new jobs created over the next thirty years…. provided the Government removes Air Passenger Duty (APD) on flights serving the region.
The new jobs would generate an additional tax ‘take’ of £376 million for the Exchequer through National Insurance and Income Tax.
Northern Ireland tourism would deliver an increase in Gross Value Added of £2.7 billion.
Abolishing the tax would lead to 36 million additional passengers between 2019 and 2050, whilst the short-term impact up until 2025 is for total passenger numbers using Northern Ireland airports to increase by 5.7 million to 64.1 million.
These are the headline findings in a major, independent report undertaken by international engineering and infrastructure consultants, Mott MacDonald, which will form the core of a detailed Submission on APD to be made to the Government by Belfast International Airport.
The report authors employed HM Treasury economic modelling to conduct the study.
They concluded that Northern Ireland’s land border with an EU Member State made it a unique UK region where policies deployed in the neighbouring jurisdiction had a significant and damaging effect on the region.
The distinct disadvantage stems from the continued application of Air Passenger Duty (£26 on a return short-haul flight) in Northern Ireland, whilst the equivalent Air Tax was abolished in 2014 by Leo Varadkar, the Irish Transport and Tourism Minister, citing the opportunity to exploit Northern Ireland’s ‘very high’ tax to the Republic of Ireland’s advantage.
The effect of this disparity imposes significant lost private investment opportunities and diverts hundreds of aviation-related and tourism sector jobs from Northern Ireland south of the border.
Without APD, Northern Ireland’s under-exploited tourism industry would be the big winner. It is estimated that visitor numbers would go up by 4.9 million, or an average of 152,142 additional visitors per year from 2019-2050. Increased visitor spend would amount to £1.2 billion.
Increased passenger traffic would underpin expansion of sport and recreational tourism, specialist tourism, key visitor attractions and the hotel sector.
Commenting on the report, Graham Keddie, Managing Director, Belfast International Airport: “We have one hand tied behind our back with airports in the Republic of Ireland given a significant head start before we even hit the track.
“We realise what the potential is, but to have our position corroborated and supported by independent experts is a tremendous boost for our campaign to drive growth in tourism through increased direct access.
“The Government has a wonderful opportunity to eliminate a palpable disadvantage and, at the same time, deliver a major economic boost to Northern Ireland. Ministers should not waste this opportunity. I would urge the Government to consider the damage that APD inflicts on Northern Ireland and conclude that the time is right to make a change for the better.”