Scottish airline Loganair has called on the Scottish Government to prioritise abolition of Air Passenger Duty on flights to the Highlands & Islands when it takes over responsibility for the tax in April next year.  

Speaking at the Scottish Parliament’s Finance and Constitution Committee, which is taking evidence about the introduction of Scotland’s replacement for Air Passenger Duty, Loganair’s managing director Jonathan Hinkles said: “We believe there is a compelling case for the present tax exemption on flights from the Highlands & Islands to be reciprocated to cover departures from Edinburgh, Glasgow and Aberdeen to those very same points.”

Hinkles told the committee that the economic benefits of the resultant lower travel costs would be felt in both the tourism industry and businesses based throughout the Highlands and Islands.

He said a proportion of travel on these routes, such as NHS patient travel, is already funded by Government – so the actual cost to the public purse of exempting these routes will be modest.

Removing the tax would also encourage passenger growth at HIAL airports, generating more income through public charges and thereby reducing HIAL’s reliance on Government subsidy.

He added: “We believe this change should be prioritised in the very first set of measures to be introduced by the Scottish Government.  Abolishing APD on flights to the islands, well before the eventual abolition of the tax for all air services in Scotland, will make a real and immediate difference to families, tourism and businesses alike.”

Hinkles also said that the change would further boost Sumburgh’s position as a growing hub for the oil and gas industry – by creating a level playing field between the tax treatment of passengers flying directly by helicopter to North Sea installations from Aberdeen, and those flying on fixed-wing aircraft to Shetland before transferring to helicopters there.

Currently those flying directly by helicopter do not pay APD, but those flying part of the way on fixed-wing incur APD on that section of the journey from Aberdeen.

Loganair operates a fleet of 28 aircraft and 570 of its 600 employees are based in Scotland.   The airline carries 750,000 passengers each year on its network of scheduled services, of whom two thirds travel on routes exclusively within Scotland.  All except one route (Edinburgh to Wick) flies over water, rendering air travel an essential part of Scotland’s transport network.

The airline announced late last year that it would launch operations under its own name once again from 1 September 2017, after 24 years operating under franchise agreements with British Airways and latterly Flybe.