From The Guardian
The government is preparing to reverse a key coalition pledge to bring in an environmental tax on air travel after finding that European Union laws would prevent it.
Last year's coalition manifesto contained a pledge to reform air passenger duty (APD)... Both parties in the coalition had said they wanted to tax "per plane" to give airlines the incentive to cut down on their carbon footprint.
The best kind of tax on air transport is auctioning off landing slots (a kind of LVT, if you will) but clearly, a tax-per-plane is far better than a tax-per-passenger. If that ends up being good for the environment, that's a bonus.
They mentioned this story on Channel 4 News yesterday, but nobody could work out which particular EU law prevented them from doing it (the Guardian doesn't say so either). This just illustrates how hopeless the Lib-Cons are: whatever policies you propose, you always have to check whether they are compatible with EU law.
I have established that three-quarters of my manifesto is incompatible with EU law (which leads me to one conclusion and one conclusion only), but it appears the Lib-Cons a) couldn't be bothered to check and b) have drawn the other conclusion (just do what the EU say, even if it makes no sense).
Thursday, 10 March 2011
Air Passenger Duty Fun
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14 comments:
Whatever piece of the UK's busted system you try to change you end up against the EU. Every time you do the sums you end up having to leave the EU as a fundamental prerequiste to get back to common sense, small governemnt and low taxes.
You forgot to mention John Snow's comment about this being a "red rag to a bull for the anti-Europeans". As if there was such a thing as an "anti-European" rather than an EU-sceptic.
The EU has my full support on this, I'm more than happy for one set of despots to stop another set from fining me arbitrarily for the crime of going on holiday.
I expect this arrangement works quite well for the coalition too, they don't want to be responsible for the fate of the UK, they'd prefer to outsource the role to the EU and avoid the blame.
chefdave
"The EU has my full support on this, I'm more than happy for one set of despots to stop another set from fining me arbitrarily for the crime of going on holiday."
I fear you are missing the point here. As we all know, changes to methods or rates of taxation prompt behavioural change as a result of human nature & also good business sense. Changing to a per plane duty is likely to result in last minute flights becoming much cheaper because the airlines will want every seat filled.
L, exactly.
RA, they all pretend that "the EU" and "Europe" are the same thing, which is infuriating but can't be helped.
CD, nope. The per-plane duty is bound to work out slightly cheaper on a per-passenger basis (as SW explains), assuming same total revenue. If a plane is half empty, the shortfall is the airline's problem, not the passengers'.
Maybe the answer is to encourage the EU. Let them make even more laws. Demand of our euro MPs that they bring in another 50,000 by 2012.
Then, when displaying meat and cheese in the same shop, walking without saftey helmet, driving a vehicle over 3 years old results in imprisonment, maybe the penny {cent} will drop.
BQ:
1. "displaying meat and cheese in the same shop". Clearly, the EU has to protect 'small local businesses', so if they prevent the butcher from selling cheese and the cheese-seller from selling meat, that encourages 'diversity' on the high street and acts as a bulwark against the evil supermarkets.
2. "walking without saftey helmet". They'll do the cyclists first, and once we're used to that... (this regulation sponsored by The Honourable Guild Of Helmet Manufacturers").
3. "driving a vehicle over 3 years old". They'll start with 'over ten years old' (new cars have lower emissions and better safety features etc) and then shorten it and shorten it. They've got car scrappage scheme for older vehicles, so this is not beyond realms. And it's for the cheeldren and the environment, so what's not to like? (this Regulation sponsored by the Honourable Guild Of Car Manufacturers).
Apropos of EU "laws" it comes down to enforcement. As an example: France was guilty of illegally stopping the import of UK beef at the time of the BSE kerfuffle. As noted here the EU authorities decided not to enforce any fine on the French for their action after the French started reimporting. The UK authorities were "disappointed" about this but did nothing further.
In other words, a hearty f*** off to the EU authorities is effective since what, in the end, can they do about it? I'll tell you - nothing. They'll graciously (or even ungraciously) withdraw from the field.
Hmm. I think this is more elfinsafety - the reason you haven't found an EU law against this is because *there isn't one*, like most of the things governments blame on the EU. Rather, because someone wants to backtrack on the pledge (at a guess, because it'd bust BA and Virgin whilst favouring Mr O'Leary), they're lying that it's an EU rule so that they can renege on the deal and have the blame go elsewhere.
This is primarily what the EU is for - so that governments can do whatever they like, and then pretend to the public that it's someone else's fault if said things are unpopular.
SW, MW, well it depends on the prices charged by the government. It could well mean that passengers that purchase their tickets earlier end up paying over the odds while the Johnny come-latelies are given deals just to cover the fixed costs. This would incentivise everyone to wait until the last minute and bugger up the airline's pricing mechanism.
I'm no expert in these matters but don't companies want to fill all their seats anyway? It seems a bit odd for the government to assume responsibility for this 'problem'.
But that wasn't the point really, I don't want either of my two governments levying taxes such as these so I the coalition won't receive my support on this one. If we want to wrestle power back from the EU then the coalition have to convince me they're going to use it properly. Otherwise there's no point!
U, exactly. But then those pol's won't get their snout in EU trough once they lose office in the UK.
JB, you're quite possibly right on that. According to this potted summary of APD, APD doesn't have the EU's fingerprints on it.
CD, it's a long story, but a per-plane tax is infinitely better than a per-passenger one.
And yes, airlines have funny pricing policies, but they seem to know what they're doing; if everybody leaves it to the last minute, then they would simply make last minute prices higher than advance bookings, it will all level out.
Well ok, I'm sure that it would all level out in the end but it is what it is, a tax on airline travel. My Georgist training tells me that whatever way you want to cut it it raises prices, lowers consumption and makes us all that little bit poorer.
As you said earlier, the most efficent method would be to tax landing slots or air/route rights, not for the sake of it but to ensure that all airline companies are given an equal opportunity to profit from running their business.
The coalition can still go stuff themselves though.
CD, and my Georgist training tells me that per-plane is much closer to landing slot auctions than to per-passenger-duty, so is the better way of doing it.
Impact on price paid by passenger is minimal because supply of landing slots sorely restricted by NIMBYs/Greenies/BAA monopoly, so we can safely assume that the airlines are already charging 'as much as the market will bear', and they can't charge more than that.
But yes, the coalition can go stuff themselves (especially if John B's theory turns out to be correct).
MW
" . . But then those pol's won't get their snout in EU trough once they lose office in the UK. "
Such cynicism!
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