Friday, December 31, 2010

HACAN: VAT goes up to 20%; Aviation still pays no VAT

HACAN today highlight the ridiculous special treatment that the aviation industry are given over and above families who are struggling to make ends meet in these difficult financial times:


Press release - HACAN

Campaigners claim it is ‘deeply unfair’ to the rest of British industry and hard-working families that the aviation industry continues to be a special case

Campaign groups are calling for VAT to be imposed on aviation. The call comes on the day when VAT has gone up to 20%. Currently aviation is zero-rated for VAT. The consumer pays no VAT on tickets, airline fuel is zero rated and no VAT is due on purchases of new aircraft. Indeed, because of the zero rating, the airlines are VAT registered and can reclaim VAT on goods and services (1).

John Stewart, who chairs the Heathrow campaign group, HACAN, and also the national umbrella body of aviation campaign organisations, AirportWatch, said, “It is deeply unfair to the rest of British industry and to hard-working families trying to pay their bills that the aviation industry continues to be a special case. It also makes no sense that one of the dirtiest and noisiest industries on the planet gets away with paying no VAT. Add this to the fact it pays no tax on its fuel and the Chancellor is losing at least £9 billion a year.”

At the end of last year, the European Commission began consulting on a revision of its VAT Directive (2). A revised Directive could include the possibility of VAT being imposed on aviation by member states of the European Union.


Notes for Editors:

(1) If aviation was exempt from VAT, it could not claim it back. The fact it is zero-rated means that it can.

(2) The consultation closes on closing date 31 May 2011

For further information:

John Stewart on 0207 737 6641; 07957385650

Press Release dated: 31st December 2010