Aviation wants YOU to PAY and it'll scream and scream and scream until you do

Today we see a fightback from the aviationisatas to the campaign against those dirty tax dodging firms who simply don't want to pay their dues in the UK. Aviation are crying about how hard life is in their business, this is something they excel at. Despite all the freeloading they already do at the expense of tax paying residents in the UK they are upset: oil has gone up to over $100 a barrel and rather than pay VAT themselves they sat back and saw Air Passenger Duty be created so the government could collect some type of tax from that specially treated sector, aviation. You can read all about it here, including comment and feedback.

Lets just consider just a few of the perks and negative effects that aviation has over other businesses in terms of finance:

1. It is rated as zero VAT - this means it pays no VAT on fuel, servicing or parts. Triples all round on that one eh?

2. It's has a privileged position in terms of reducing emissions, don't ask us how it's achieved it, we'll leave you to imagine: whilst we all take on the cost and responsibility of reducing emissions, aviation responds that 'they can't afford to reduce theirs'.

Can you really afford that extra VAT on those essential items in your shopping trolley each week? Well if you can't why not just say to your supermarket that you can't afford the VAT as it's too expensive and deduct if off the bill. Even better, why not try deducting it off your utility bills? Yes, the luxury of heating a home will become considerably cheaper if residents were given the same perks and 'special treatment' that the aviationistas receive.

Fuel poverty is not something the aviation industry has ever had to deal with, however it is most certainly something a lot of people have to deal with under the London City Airport flight paths. Oh yes, London City Airport are just one of the airports that are asking for more special treatment on taxes, the same airport that gets London Taxpayers to pay their £5.5m annual security costs for the MET and received £1,256,629.00 of taxpayer money from the London Development Agency between 2004-20011. Yes, London City Airport is insatiable for your money!!

3. In 2008 aviation created a £17.6 billion tourism deficit - it took this money out of this country and dumped it somewhere else. So at a time when we keep hearing business say that they need consumer confidence to spend more money in the UK the aviation industry want more state benefits/special treatment to help them fly more people, and their money out? We know who we'd like to fly out on a one way ticket, and it's not the tourists.

4. Then we come to that little issue of where and how aviation pays it's taxes. London City Airport - in various names just happens to be registered in the Channel Islands. We can't think why that would be, however it was suggested by a local resident that this could be due to them not wanting to pay UK taxes. What, LCY not want to pay their way - surely not!! City Jet is another - ask them how many of their staff are registered as employees and paid in the UK. So despite their staff being counted in the employment statistics at LCY it appears none are actually registered in this country as employees. They instead appear to be paid in Euros. So no tax for the UK there then either. We could continue, but we simply don't have the time to list all the misdemeanors.

LCY is situated in the third most socially deprived borough in the country, after over 26 years the airport has had not had any tangible impact on helping improve the fortunes of the very people and communities that are subject to excessive air and noise pollution as a result of it's activities.

Whilst you pay more VAT: No VAT is charged on aviation fuel or flights from airports within the EU.

It seems all money that aviation (London City Airport) take from the London Taxpayer, as per yesterday's posts here and here, is simply not enough! For an airport and industry that likes to make wild claims about how much they contribute, they certainly seem keen to take a lot from you the taxpayer. The Channel Islands also seems to be a favourite place of London City Airport for registering business too. Strange that.

Few people are aware that aviation pays no VAT on aviation fuel and flights. We can only welcome the news in The Guardian that 'TakeVAT' is highlighting the issue of how much these and other tax breaks are costing the tax paying public. We can only hope that TakeVAT builds and builds.

Take VAT plans action against companies avoiding the 20% tax

Protest group inspired by UK Uncut activists to stage first action against groups avoiding VAT
It was formed less than six months ago, but the success of UK Uncut's non-violent, direct actions is inspiring similar protest movements. One of these, Take VAT, stages its first actions on Saturday.

Take VAT, which describes itself as a "UK Uncut-esque" action group, was formed last month to raise awareness of companies that avoid paying VAT.

These range from companies such as HMV and Tesco, which use a VAT loophole to sell CDs and DVDs VAT-free from the Channel Islands, to airlines. No VAT is charged on aviation fuel or flights from airports within the EU.

Hedge Fund Owned London City Airport Make More Unbalanced Claims

Since the the 18th November we keep hearing about a report that the City of London Corporation have paid York Aviation to carry out. Interestingly, the media have referred to it on various occasions since, but low and behold, none of them had seen the report when we questioned them. So all the spin and claims were without any reference to evidence for the past few months.

Today we see more over exaggerated claims from the airport about their self claimed contribution to London.

"As well as direct economic benefits, it has also levered investment in public transport, in particular the DLR extension to Woolwich Arsenal"

Really, they invested so much in the DLR? Transport from London and the Transport Select Committee didn't seem to think their contribution was so great as we wrote in a blog item in November 2008:

At the Select Committee on Transport 9 May 2007, yet again it appears that London City Airport c/o Richard Gooding has been shirking it full financial responsiblities. The moths must really build up in LCAs gold coin purse. Before reading the following, keep in mind that LCA consistently tells residents in Newham that LCA is responsible for the regeneration, particularly in the Royal Docks. They have indeed even claimed that it was down to them that the DLR came to town, always inferring that they have invested so much finance into the area and into the DLR - seems they didn't invest as much as they'd like you to think:

Q595 Chairman: How do you think dedicated services ought to be funded from airports as public transport?

Mr de Cani: The DLR extension has been funded primarily through Transport for London so it is publicly funded. However, there are small contributions through planning gain agreements, section 106 agreements. London City Airport has made a small contribution to the extension of the order of about £2 million. That compares to a capital cost of about 140 million. We would have liked it if they had made a bigger contribution and we tried to do that but the railway is serving a whole range of other objectives and contributing to the regeneration of east London so this extension was not just about the airport. We think they got a good deal.

Chairman: I am sure they did.

So they 'levered' in £2 million out of £140 million towards the DLR. So that adds up to just over a 1.4% contribution, the rest picked up by....surprise, surprise the London taxpayer! Still, going on how difficult it is to get money out of London City Airport (see reference to security costs) then we can imagine it really did have to be 'levered'.

As for LCY being the main regenerator of the area, it is arguably Exel that is the driving force bringing in £1.6b annually (just a little more than the claimed £500m by the airport!), without the noise and air pollution and whom have won awards for their wormery. The best you'll get for 'green initiatives' at LCY, is a photo of a paper shredder, as proudly displayed in their application for expansion.

Richard Gooding was quoted as saying: “Whilst we have to do everything we possibly can to mitigate environmental impacts, we run into the trap of ignoring the benefits,”

Well there's one thing that London City Airport haven't done and that's ignore the benefits, the business welfare benefits on offer to them: particularly those from the London tax payers purse through all the millions of pounds of subsidies from the London Development Agency. But don't forget the £5.5m+ a year security bill which they simply refuse to pay because they think you, the London tax payer, should pay it for them. Yes, the London tax payer is paying for a private hedge fund owned airport!

So when your council cuts your services, closes down your libraries, reduces your policing due to the economic environment at the moment: question whether London City Airport are being told to sling their hook and pay their own £5.5 million security bill, repay the £24 million security costs they've had over the past 5 years or so, and repay all the tax payer funded monies they have been given by the LDA over it's lifetime? Apparently we're all in this together, aren't we? So if your communities funding is being cut, why would tax payers money continue to be given to a privately owned airport?

Richard Gooding is correct in referring to an 'unbalance': there is clearly a very big imbalance between the amount of London taxpayers money which has funded the airport and how little is given back to Londoners. It's ironic and strange, for an airport that claims it is 'integral' and a key source of regeneration that after 25 years that Newham is still one of the most socially deprived boroughs in the country.

It must have been really helpful for that lowest tax band increase on the lowest earners to help subsidise private businesses like London City Airport. Never mind where the money comes from or at what cost eh?

London City Airport's Economics - The FACTS

London City Airport costs London taxpayers over £5million a year in Metropolitan Police security costs

LCA costs taxpayers, per passenger 1000% (£1.70) more than Heathrow passengers

Each direct aviation job receives a tax subsidy of £50,000 per year, £1000 per week or £25 per day by way of the £9billion lost in fuel tax and vat which the aviation industry are excused from paying

In 1998, at the last expansion, London City Airport promised jobs would go from 1100 to 4000 direct and indirect jobs

In 2008 the airport claims to have 'created' 2000 jobs – but there is no hard evidence – this falls short by 2000 of their claims in 1998

In 2008 the airport directly employs just 406 people, of which 120 come from Newham

The airport has failed to meet the employment targets as set out in the section 106.

Newham residents should make up 35% of employees, they make up 29%.

Local employment (local regarded as a five mile radius) should be 70% but is 68%.

Newham is the most socially deprived borough in London and England, even after 20 years of the airports claimed effect on regeneration on the community

London City Airport contributed a 'small contribution of £2million' to the DLR which cost £140million – this was questioned by the Transport Select Committee, May 2007

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London City Airport and the aviation industry are nothing more than modern day highwaymen...stand a deliver your taxes now!!