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Budget Savvy Brits Change Travel Plans To Avoid Air Passenger Duty

06 June 2012

British air passengers are each paying significantly more money on taxes and fees for air travel than many of our European neighbours, according to new research(1) by Sainsbury’s Travel Money. With Air Passenger Duty (‘APD’) rates increasing again last month(2), the survey reveals that higher taxes and fees are imposed on passengers flying from London than those departing from Paris, Frankfurt, Amsterdam, Madrid and Rome.

Fed up with the expensive tax burden on air travel, research commissioned by Sainsbury’s Travel Money reveals that nearly half of British travellers (46%) say they would take ‘APD avoidance’ measures such as taking long-haul flights from other European countries to reduce the amount of Air Passenger Duty they pay(3).

David Barrett of Sainsbury’s Travel Money, said: “Our research suggests that some families are rethinking their holiday plans because of the increased level of tax placed on some flights through Air Passenger Duty. It appears that many are willing to do all they can to get around it, from avoiding air travel altogether to taking long-haul flights from more competitively priced European airports.

“At a time when household budgets are being squeezed, we would encourage families to spend more time researching ways to ensure they still enjoy their family holiday and at the same time, reduce their holiday bills. This means not only looking at how to save on travel costs but also ensuring they get the best rates on their spending money by shopping around and arranging their travel money before they travel.”

The findings(1), based on researching typical prices of national flag carrier flights from major International Hub airports in Europe to a range of popular long-haul destinations, show that a passenger flying Economy Class from London to Sydney could typically pay more than £190 in taxes and fees than those travelling from Amsterdam to Sydney. The London to Sydney charge is over £554 compared to just £362 from Amsterdam.

London passengers flying Economy Class to Cape Town would typically pay £460 in taxes and fees, substantially more than the £347 for passengers travelling from Rome, £326 from Amsterdam or just £318 from Paris(1).

Taxes for London Economy passengers are slightly more competitive when travelling to New York at £351 when compared to travelling from Frankfurt, which would cost £383, however travelling to the Big Apple from London is still considerably higher in term of taxes and fees than from any of the other European departure airports surveyed(1).

The supermarket bank’s research indicates that in an effort to reduce their APD bill or avoid it altogether, over 7.5 million (16%) Brits would go to a short-haul holiday destination rather than long haul. Over 6.6 million (14%) would book a short-haul flight to a non-UK airport, have a stopover and then take a separate long-haul flight from there(3). This can work out more cost-effectively if the difference in flight prices is greater than the cost of the overnight stay.

One in eight Brits (13%) would deliberately choose a destination in a cheaper APD band and one in five (20%) would try to get the best economy class cabin seats at the front of the cabin instead of booking Premium-Economy or Business Class seats, which carry a higher APD charge. Some 12% of Britons would choose an alternative mode of transport and avoid air travel altogether in an effort to avoid APD(3).

Sainsbury’s Travel Money offers a Cash Passport™ pre-paid currency card that you can load with your spending money in the UK and withdraw foreign currency from ATMs free of charge abroad(4).
It also offers benefits and services such as competitive rates and next-day delivery to the customer’s billing address on foreign currency, if ordered online before 2pm from Monday to Thursday, plus free delivery is available for online and phone orders over £500(5).

To find out more about Sainsbury’s Travel Money log ontohttp://www.sainsburysbank.co.uk
Or call 0845 301 2724. Customers can also buy foreign currency instantly from our Travel Money Bureaux in selected Sainsbury’s stores across the UK.

-Ends-

Notes to editors:

(1) Sainsbury’s Travel Money conducted a survey of typical flights from London, Frankfurt, Paris, Madrid, Rome and Amsterdam to New York, Cape Town and Sydney, using the national flag carrier airlines of each departure nation. Research was conducted on via expedia.com on 16th and 19th March 2012 for flights departing on April 30th 2012 and returning on May 14th 2012, looking at both Economy Class and Business Class flights.

ECONOMY FLIGHTS TO NEW YORK Total flight cost Amount of fare due to taxes and fees
Frankfurt £675.80 £382.80
London £435.39 £351.39
Paris £603.70 £318.70
Amsterdam £614.50 £301.50
Madrid £467.90 £291.90
Rome £511.70 £290.70

ECONOMY FLIGHTS TO CAPE TOWN Total flight cost Amount of fare due to taxes and fees
London £810.49 £460.49
Frankfurt £779.20 £454.20
Madrid £773.78 £444.78
Rome £638.68 £346.68
Amsterdam £872.00 £326.00
Paris £603.80 £317.80

ECONOMY FLIGHTS TO SYDNEY Total flight cost Amount of fare due to taxes and fees
London £835.09 £554.09
Madrid £1,260.38 £465.38
Rome £1,311.90 £458.90
Frankfurt £1,286.30 £457.30
Paris £845.70 £442.70
Amsterdam £994.60 £361.60

BUSINESS FLIGHTS TO NEW YORK Total flight cost Amount of fare due to taxes and fees
London £1,833.39 £522.39
Rome £1,857.90 £437.90
Paris £2,176.40 £432.40
Amsterdam £2,529.10 £385.10
Madrid £1,830.10 £342.10
Frankfurt £2,577.10 £333.10

BUSINESS FLIGHTS TO CAPE TOWN Total flight cost Amount of fare due to taxes and fees
London £3,578.69 £664.69
Paris £3,138.90 £536.90
Frankfurt £3,515.80 £498.80
Madrid £2,548.78 £494.78
Amsterdam £2,336.60 £409.60
Rome £2,294.20 £320.20

BUSINESS FLIGHTS TO SYDNEY Total flight cost Amount of fare due to taxes and fees
London £4,225.55 £738.55
Rome £4,084.70 £702.70
Paris £4,482.30 £547.30
Frankfurt £5,499.30 £457.30
Madrid £3,888.38 £455.38
Amsterdam £4,400.60 £449.60
(2) HMRC
Air Passenger Duty – previous and new rates effective 1 April 2012
The new rates are shown alongside the previous rates:
Band Miles from London Reduced rate (lowest class of travel) Standard rate (any other class)
Previous From 1 April 2012 Previous From 1 April 2012
Band A 0–2,000 miles* £12 £13 £24 £26
Band B 2,001–4,000 miles £60 £65 £120 £130
Band C 4,001–6,000 miles £75 £81 £150 £162
Band D over 6,000 miles £85 £92 £170 £184

*includes direct long-haul flights from Northern Ireland.
The tables specifying which countries and territories fall into each of the APD bands can be found atwww.hmrc.gov.uk/pbr2008/pbrn20.pdf.

(3) Sainsbury’s Bank commissioned ICM to conduct this research on behalf of its Travel Money division. 2,001 GB adults were interviewed by ICM in an online survey between 7th and 8th March 2012. Interviews were conducted across the country and the results have been weighted to the profile of all adults.  ICM is a member of the British Polling Council and abides by its rules.  Further information atwww.icmresearch.co.uk
(4) ATM operators may charge a withdrawal fee or set their own withdrawal limits – however the Cash Passport™ issuer will not charge a withdrawal fee on ATM transactions abroad.
(5) Delivery charges apply: £4.75 on minimum orders of £100-£299.99; £2.35 on orders of £300-£499; and free delivery on orders of £500 or more. A £1.99 administration fee applies to all online orders under £100 for collection in store, orders above £100 can be collected in store free of charge. See www.sainsburysbank.co.uk for full details and terms and conditions.
Sainsbury’s Bank:
To view our latest press releases and product information, please visit the Sainsbury’s Bank online media centre atwww.sainsburysbank.co.uk/media

Sainsbury’s was the first major British supermarket to open a bank, commencing trading in February 1997. Benefiting from a fantastic, trusted brand that enables us to combine the shopping experience with personal finance, Sainsbury’s Bank provides a range of quality products including insurances, credit cards, savings and loans. Our proposition is to make shopping more rewarding by offering customers great products at fair prices, while consistently rewarding shoppers for their loyalty and being easy to do business with at all times.  Our products consistently top Best Buy tables and regularly win awards for quality, price and service.

Sainsbury’s Bank recent awards in 2012 include Best Personal Loan Provider, Consumer Moneyfacts; Best Low Rate Credit Card Provider and Best Credit Card Provider for use abroad (Gold Credit Card), Moneynet; Best Loan Provider, Moneysupermarket Supers.

2011 awards include Best Overall Online Provider, Best Online Pet Insurance Provider, Best Online Personal Loan Provider and Best Direct Home Insurance Provider at the Your Money Awards. It was also named Most Competitive Term Assurance Direct Provider by Moneyfacts.

Sainsbury’s Bank is a joint venture between J. Sainsbury plc and Lloyds Banking Group.
For further information and general Sainsbury’s Bank enquiries, customers can call the freephone number on0500 40 50 60 or visit www.sainsburysbank.co.uk

About Travelex:
Travel Money online and instore is provided by Travelex Agency Services Limited, registered number 4621879. Sainsbury’s Travel Money ordered by telephone is provided by Travelex Currency Services Limited, registered number 03797356. Registered office for both companies: 65 Kingsway, London WC2B 6TD.
Travelex In 1976, Lloyd Dorfman opened the first Travelex Bureau de Change on Southampton Row, London. He is now the Chairman of the world’s leading foreign exchange specialists. We trade in over 80 currencies and in 25 countries.

Customers can find Travelex online and in over 1,000 stores, including all the major airports. Travelex has over 500 ATMs around the world and takes care of foreign currency services for partners including banks, supermarkets and travel agencies, extending our reach to over 100 countries and 20,000 locations.

Travelex continues to grow the geographic reach, both organically and through targeted acquisitions in growth markets. Recent acquisitions include FX Africa in South Africa and Grupo Confidence, the largest consumer foreign exchange specialist in Brazil. www.travelex.co.uk

Cash Passport: Cash Passport™ is issued by R. Raphael & Sons plc, pursuant to license by MasterCard International. MasterCard and the MasterCard Brand Mark are registered trademarks of MasterCard International Incorporated.www.cashpassport.com
Notes to editors/webmasters
If using this article on a website, please link towww.sainsburysbank.com using the following hyperlink text at the bottom of the article:
<a href=”www.sainsburysbank.co.uk/investing/ins_travelmoney_tmo_skip.shtml”>Sainsbury’sTravel Money</a>

For further information, please contact:
Ian Morris / Tom Wilson
Citigate Dewe Rogerson
020 7282 1037 / 2842