UK drops plan to introduce new air travel tax

Environmental spending planned for 2010-11 will be brought forward to stimulate low-carbon growth, finance minister says

The British government has abandoned a plan to replace the UK's air passenger duty with a new per-plane environmental tax, finance minister Alistair Darling said on Monday as he presented a draft budget to parliament (EED 10/10/07).

Instead the government will reform the existing tax, introducing from November 2009 a four-band system based on distance travelled.  It wants to avoid "the disruption and costs associated with the transition to a new tax… at a time of economic uncertainty", according to the draft budget.  Rates will increase significantly from 2010.

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