Finance Bill

It is a great pleasure to follow the hon. Member for Walthamstow (Mr. Gerrard). He made a valid and powerful point about the need to bear the per-mile damage in mind rather than opting for a banding system. If we can adopt such an arrangement—or something nearer to it—the position will improve greatly, because it will be environmentally friendly. Let me begin by referring the House to my entry in the Register of Members' Interests, which states that I am a non-remunerated director of a travel company. The Government have got themselves into a terrible tizz over APD. I think that they were right when, a year or so ago, they said that they would introduce a per-plane tax, but they got into an awful mix-up over premium and standard passengers. I remember that they discriminated against tall people last year: for some reason they thought that there were business-class-only aircraft flying around, when in fact all the companies concerned had gone out of business. The Treasury estimated that it would raise an extra £5 million from a class of airliners that did not exist. Having got into a terrible muddle in trying to define the distance between seats according to whether they were standard or premium, it has now included premium and economy seats in the premium APD. The real question, however, is whether this measure is a stealth tax, designed purely to raise money for the Government. I fear that, in large part, it is just that. My right hon. Friend the Member for Witney (Mr. Cameron) has taken hold of the Conservative party and shaken it, as he has done in many other contexts: he has brought environmental issues to the top of the Conservative agenda. I fear that APD is not an environmental tax in any sense. If an aircraft is flying to Florida carrying two passengers, they will pay two lots of duty. If it is carrying 230 passengers, they will pay 230 lots of duty. That cannot be environmentally correct. It is as simple and as straightforward as that, and many other Members have made the same point. The Board of Airline Representatives in the UK, known as BAR UK, has made a point that has not featured much in the debate about passengers coming into the United Kingdom. Let us suppose that an American says to a travel agent, "I want to go to Europe: where do you suggest that I fly to?" The travel agent will say, "It is several hundred pounds cheaper to fly to Schiphol than to fly to London." I remember that a few years ago there was much talk of Schiphol's being the third London airport. It is crazy to put this country at a disadvantage. The Government need to come up with a taxation system that is based on environmental considerations. I agree with the hon. Member for Taunton (Mr. Browne) that there should be a tax on airlines to help to control emissions, but it should not be one that puts our airline industry and our cities at a disadvantage. If it is too high and out of synch with the rest of Europe, it will merely be a stealth tax, but I think that that is the direction in which the Government are moving.