BA to cut recruitment after APD rise
07.12.11
BA will recruit fewer staff next year as a result of the Government's 8% rise in Air Passenger Duty (APD). Next April's tax rise will mean that BA will hire 400 new staff, rather than the 800 originally planned. Willie Walsh, CEO of BA parent IAG, said the harm to the economy the increase in APD will cause will excee the revenue raised. A Treasury spokesman said the aviation sector had to ‘play its part’ in restoring the public finances.
BA had planned to take on 800 staff in 2012, but this will now be cut in half, and the airline will also review plans to bring an extra Boeing 747 to Heathrow. Mr Walsh said: ‘I believe that this tax is doing more harm than good. The impact on the economy is significantly greater than the tax revenue the chancellor is looking at. That is why we have called for an independent review of APD to properly assess what the impact on the economy is.’
Under the new rates announced yesterday economy-class passengers flying no further than 2000 miles will see their APD rise from £12 to £13 per passenger. Longer flights up to 4000 miles will see an increase from £60 to £65, flights between 4,000 and 6,000 miles will rise from £75 to £81 and the tax on economy flights above 6000 miles - such as trips to Australia - will rise from £85 to £92. The tax for premium class passengers will be double these economy rates.
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