Newcastle Airport faces a “catrastrophic” drop in passenger numbers if it is not able to compete with plans by Scotland to abolish Air Passenger Duty (APD), according to economic experts.
Policy North - the North’s only business-led think tank - says the region should be able to set its own APD level to see off a threat from North of the border.
Following the devolution of APD to Scotland, the SNP government wants to cut the tax by 50 per cent, before scrapping it completely.
Policy North’s ‘Global North’ report found that families could save up to £194 per person by flying from Edinburgh instead of Newcastle. This follows estimations by Newcastle Airport earlier this year that - when the Scottish government scraps ADT altogether - they would lose between 500,000 and 900,000 passengers per year.
Newcastle airport’s Chief Executive Nick Jones recently called for the Government to announce specific measures to support English regional airports from the impacts to ensure a “fair system without market distortions and a level playing field throughout the UK.”
Policy North has called on the Government to grant the North East special status due to its close proximity to Scotland.
The think tank propose that the North East should be given the power to set the rate of APD in the region, or risk losing vital transport links and business to Scotland.
Policy North founder and chairman, Stephen Purvis, said: “If nothing is done to support regional airports from the Scottish government’s ADT devolution, the consequences could be catastrophic.
“Saving up to £194 per person slashes a huge amount off a family’s annual holiday spend, and in the face of such savings, it would be hard for families to turn down the opportunity to fly for cheaper – especially when Edinburgh airport is less than 100 miles up the road.