IAG: High UK taxes make Level flights unlikely

International Airlines Group (IAG) has warned UK legislators that the chances of IAG’s new long-haul LCC Level operating from the UK are slim while the country’s passenger taxes remain so high. In a letter to Members of Parliament, IAG said air passenger duty (APD) undermines the UK’s position as a global trading nation as it exits the European Union and reduces the chance of Level flights from UK regions. In its letter, IAG said abolishing APD would make it more likely that Level could operate from Birmingham, Cardiff, Edinburgh and Manchester. However, this was not financially viable when Level’s fares start at around GBP88 one-way, yet APD on a long-haul economy seat is GBP78. IAG said it is seeking to expand Level, which launched flights from Barcelona to the US and Latin America last year, and will start operating from Paris to the Caribbean and North America in July. “British consumers are losing out because of APD,” IAG CEO Willie Walsh said. “In Spain and France, Level can offer lower fares than it can in the UK—and that goes for other long-haul, low-cost airlines, too.” In the letter, IAG said it was foolhardy for a trading nation that relies on developing international connections post-Brexit to tax aviation so heavily. While economy-class passengers paid GBP78 APD, the tax rate is even higher on premium passengers, it noted—GBP156 in premium economy and business class. The latter rate is scheduled to increase another 10% (to GBP172) next year.<br/>