The North East should be able to set its own Air Passenger Duty (APD) level and see off a threat from north of the border, according to a regional think-tank.
Policy North has warned of ‘catastrophic’ consequences for Newcastle International Airport if it is left undefended against potential Scottish air travel tax cuts.
Following the devolution of APD to Scotland, the SNP-led government wants to reduce the new Air Departure Tax (ADT) by 50 per cent, before eventually scrapping it completely.
The Scottish Parliament is expected to vote on the rate at which is the new tax is set later this year. It will introduced on April 1, 2018.
The think-tank’s Global North report found that families could save up to £194 per person by flying from Edinburgh instead of Newcastle.
This follows estimations by Newcastle International Airport earlier this year that if the Scottish government scraps ADT altogether, it would lose between 500,000 and 900,000 passengers per year.
Policy North has called on the Government to grant the North East special status due to its close proximity to Scotland.
Its founder and chairman, Stephen Purvis, said: “If nothing is done to support regional airports from the Scottish government’s ADT devolution, the consequences could be catastrophic.
“As well as the annual holiday rush, the risk to the North East and the North as a whole is that more companies will decide to invest in Scotland because of their cheaper air travel.
“We support further devolution to local Mayors, who would have responsibility to determine APD rates in their region.”