THE chancellor scrapped a planned rise in air passenger duty yesterday, but admitted that legal difficulties have shelved a change to aviation tax.
Air passenger duty will be frozen this year, with a hike linked to the retail price index planned for April 2012, George Osborne said.
The government said in the emergency June Budget it would look to switch aviation tax from a per-passenger to a per-plane duty, to ensure planes flying half-empty would be charged the same as a full flight.
Osborne also stopped short of introducing a “Learjet levy”, or tax on business jets, trailed earlier this week to close a loophole exempting corporate jets from the air passenger duty.
Osborne instead delayed the plan to 2012, after launching a consultation on the structure of the tax.
Lord Sugar slammed this proposal as a PR stunt, claiming “the revenue on private flights, based on the same duties paid by holidaymakers, will not add up to a row of beans”.