A “LACK of clarity” around Scottish Government plans to replace air passenger duty (APD) “risks parliamentary scrutiny”, tax experts claim.
The Chartered Institute of Taxation (CIOT) is calling for independent analysis into the impact of cutting and axing the charge to be published. It claims there is not enough detail about plans to replace APD with Air Departure Tax (ADT) from April next year and says a special report could “strengthen” the rationale behind the change.
APD earned Scotland £275 million in 2015-16 and the CIOT, a trade body representing tax professionals, says the Scottish Government’s Air Departure Tax Bill is short on information about proposed rates, bands and exemptions for the replacement. There are also no fiscal forecasts on how halving duty from next April or eventual abolition will be achieved.
First Minister Nicola Sturgeon has said the change will benefit families and other holidaymakers who “may well welcome a reduction in the cost” of going abroad.
But Moira Kelly of CIOT said: “Of all of the tax powers being devolved to the Scottish Parliament, the proposed replacement of APD has been the one that has generated the most interest and debate, despite accounting for a relatively small share of the country’s overall tax receipts.
“There is a case to be made for using this legislation to outline who will pay what, when they will pay it and who will be exempt, as is the case in UK legislation. In the absence of information such as this, it is very difficult to say with any degree of certainty what benefits, if any, this change will make.”
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