Taxes on air fares have been increased despite airlines calling for them to be scrapped.
The Treasury announced that Air Passenger Duty (APD) for long-haul economy tickets will increase by £2 to £80, while the rate for those travelling in premium cabins will rise by £4 to £176.
The changes come into effect on April 1.
APD for short-haul flights in economy will be frozen.
A spokeswoman for British Airways’ parent company IAG said: “Given the acute pressure on business, the hike in APD will make it even harder for UK firms to trade overseas.
“This is a tax on business.
“Last year, IAG paid around one billion euros in APD to the Treasury.
“This costs UK jobs and growth.
“If the Government is serious about making Britain a global trading economy, the world’s highest aviation tax should be scrapped now.”
Regional airline Flybe, which collapsed last week, blamed APD as one of the reasons for its financial struggles.
The Government said it will publish a consultation on aviation tax reforms in this spring.
It will consider the case for exempting return legs from APD for domestic trips, and increasing the number of international distance bands.
Tim Alderslade, chief executive of Airlines UK, the industry body representing UK-registered airlines, said: “The review into the impact of APD on domestic aviation and the expectation that once the Brexit transition phase is over the double whammy on regional carriers will end is welcome.
“That said, APD as a whole, across all routes, is a damaging tax and completely counterproductive to the aims of making Britain a global trading nation.”
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