Wed 11th Jul 2018
July 2018: NI Chamber has campaigned strongly about the negative message APD is sending to tourists, investors and exporters.
I am delighted to have been appointed President of the Northern Ireland Chamber of Commerce and Industry for an extended period.
My time has started with glorious weather as Northern Ireland basks in our second heatwave of the summer, everyone is in good humour and the tourists have arrived seemingly en masse.
But there are dark clouds… in the shape of APD and VAT.
NI Chamber has campaigned strongly about the negative message APD is sending to tourists, investors and exporters. As a small island economy – and as the only part of the UK with a land border with another part of the EU (which does not have an air passenger duty) – it is extremely important that Northern Ireland looks at all options to remain competitive and enhance air connectivity.
There are severe disadvantages which arise from the controlled application of APD which imposes a £26 levy for every passenger on a return short haul flight, whilst the equivalent tax was abolished in 2014 in the ROI.
Whilst consulting with our members in the industry it is evident that APD is inhibiting our air links with Europe and further afield. They are essential connections that bring in tourists and new firms and also provide the links that our exporters need to grow their businesses in existing and new markets. It penalises businesses who need to fly to establish trade links and export their goods, especially when our businesses are operating in an ever more competitive international market. It also puts our local airports at risk.
In order for Northern Ireland to remain competitive and support strategies designed to grow export and tourism, we need APD in line with the rest of the island.
NI Chamber also supports the call from colleagues in Hospitality Ulster for a sharp cut in VAT particularly within the strategically important tourism industry and one which impacts others especially the food and drink sector, as well as transport and construction.
We have played a leading role in the campaign for Northern Ireland to be as competitive as the ROI hence our continued support for the reduction in corporation tax to support inward investment. We also support the campaign for a reduction in the 20% VAT rate on the tourism sector which puts Northern Ireland at a competitive disadvantage with the ROI where the rate is 9%.
NI Chamber strongly believes that reducing corporation tax, cutting VAT for particular sectors, in addition to removing APD, makes sound business sense for the Northern Ireland economy, whilst bringing a positive fiscal return to both HM Treasury and HMRC.
NI Chamber has recently responded to HM Treasury’s Call for Evidence on VAT, Air Passenger Duty (APD) and tourism in Northern Ireland.
It’s time for swift action…just like making the most of the good weather.