Tour Operators Challenge Air Passenger Duty

19 Jul 2007

Judgment is expected in September in R(Federation of Tour Operators) v HM Treasury.

The Federation of Tour Operators challenged the recent increase in the rate of Air Passenger Duty, a tax upon the carriage of passengers by air, which is typically passed on by airlines to their passengers.

Tour Operators sell flights as part of package holidays but are prevented by the Package Travel Regulations from passing on the increase in the tax to customers who had already made bookings, but not yet travelled, at the time this increase took effect.  They argued that the Treasury overlooked this difficulty and that as a result a burden of £45 – £50m of the tax has unintentionally stuck with them, giving rise to a breach of their “right to property” protected by Article 1 of the First Protocol to the ECHR.  They further argued that the entire tax was contrary to the Chicago Convention on aviation, and Community law.

Tim Ward acted as junior counsel for the tour operators.

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Tim Ward QC