The planned increase in Air Passenger Duty for this April has been deferred until 2012.

There was some good news for UK holidaymakers yesterday, when the Chancellor George Osborne delayed the planned with-inflation rise in Air Passenger Duty (APD) until April 2012. The Chancellor stated that he proposes to recoup some of the income by imposing a new tax on users of private jets, who are currently exempt from APD.

UK air passengers are currently charged £12 in Air Passenger Duty on economy short haul flights (£24 business class) and up to £170 per person on business class long haul flights over 6000 miles (£85 economy class).

These rates were due to rise this April, putting the tax on a long haul flight up to as much as £186 for business class passengers flying over 6000 miles. The increased tax rates are now due to come into force in April 2012.

After lobbying by the Caribbean Tourism Organisation, the Chancellor has also announced plans to reform anomolies in the distance bands of Airport Passenger Duty, which results in flights to the Caribbean attracting a higher tax than flights to California, even though California is further away.