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Threatened New York air route reprieved, but future is uncertain

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Robert Graves

Northern Ireland’s only transatlantic air route has been saved — for the time being.



The popular Continental service from Belfast to New York (Newark) — which is worth around £20m to the local economy — had been threatened by the huge increase in Air Passenger Duty (APD) introduced by the Treasury last November.

It meant that a levy of at least £60 was being imposed on each US-bound passenger and had travellers from Northern Ireland switching instead to Dublin Airport, where the charge is just €3.

Now, after intense negotiations between the airline, Belfast International Airport (BIA), Stormont Executive ministers and the UK Treasury officials, the route — which ferries 100,000 passengers a year — has been given a reprieve.

In an exclusive interview, Belfast International Airport’s business development director Uel Hoey said the route is being monitored closely.

“New York to Belfast service is an essential cornerstone of Northern Ireland’s current and future inward investment and tourism strategy,” Mr Hoey said.

“Not only because of the direct link to New York, but due to the extensive coverage available throughout North America via Continental’s Newark hub.

“The service continues to perform strongly in traffic terms, but now we have a blatant disparity on the level of tax being applied to Belfast compared to Dublin.

“This unfair, onerous tax comparator for long-haul flights is what we are focused upon redressing within the earliest possible timeframe.”

It is understood that Continental will be monitoring the route over the summer before making a final decision.

Boosted by the stay of execution, BIA chiefs are now hoping to set up more transatlantic and long-haul routes to Toronto, Chicago, Boston and Dubai — but the APD issue remains a huge obstacle to this progress. Dublin Airport currently handles 1.5 million long-haul and transatlantic passengers every year — and Belfast International is desperate to tap into that lucrative market.

The Executive wants Northern Ireland to be made a special case like the outlaying Scottish islands, which are exempt from the aviation levy.

As with corporation tax, it believes the province qualifies for special treatment because it borders another country that can undercut it tax-wise.

Tourism Minister Arlene Foster said she was aware of the strategic importance to Northern Ireland of the Continental flight.

“My officials have been working closely with key stakeholders to ensure that we do all we can to promote the route and encourage additional traffic,” Ms Foster said.

Continental has been operating out of Belfast for six years and has carried over half-a-million people between here and the US.

It has an 85% take-up rate and was said to be very successful until the APD issue arose.

A spokeswoman for Continental said the resolution of the issue was of utmost importance.

“We are in constructive discussions with the Northern Ireland Government to find temporary solutions to the APD taxation issue,” she said.

Background

APD is calculated by measuring the distance travelled between two airports, and then comparing the data to a list of tax bands, designated A to D, by increasing distance from London. Europe, for example, falls into Band A, and generally incurs the lowest APD. The British Airports Authority claims that the APD on Band C and D locations could force 5% of long-haul travellers to alter holiday plans.


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