'Delivering Scotland's Air Departure Tax': consultation analysis report

6. Analysis Part D – Impacts

Part D of the consultation document focused on the anticipated impacts of the tax. These sections invited views on impacts in relation to the following:

• Business and Regulation
• Child Rights and Wellbeing
• Environment
• Equality
• Fairer Scotland Duty
• Island Communities
• Rural Communities

Analysis Notes

Where respondents have referenced or repeated information already set out in their responses to Part A, B and C of the consultation, these themes are not set out in detail.

Question D1: Do you have any information which could inform any final BRIA relating to the revised Highlands and Islands exemption?

27 respondents answered Question D1. Of these, 12 said some variation of ‘no’. Comments that were out of scope of Question D1 are not included in this summary.

Multiple respondents offered information regarding the impact of ADT on the viability of routes, particularly marginal ones. As this has been set out in previous questions, this impact will not be set out in detail here.

“Demand on thin regional routes is highly elastic. Even modest fare increases can reduce travel, weaken airport finances and increase subsidy requirements. The BRIA should model these effects and consider wider impacts on tourism, business activity and public service delivery.” – Loganair

Several respondents mentioned the financial impact of compliance on carriers which could be worsened by frequent administrative change, uncertainty around rates and insufficient guidance.

Some respondents noted the possibility of passenger leakage and relocation of aviation services to Central Belt airports from the Highlands and Islands region and more generally to English airports from Scotland. These respondents proposed further analysis of the possible financial impacts on Scotland due to passenger and industry leakage.

Question D2: Are you aware of any examples of particular current or future impacts, positive or negative on young people, (children, pupils, and young adults up to the age of 26) of any aspect of the proposals in this consultation?

23 respondents answered Question D2. Of these, six said some variation of ‘no’. Comments that were out of scope of Question D2 are not included in this summary.

Many respondents emphasised that young people are particularly price-sensitive to changes in flights prices and often rely on flying for access to education, employment and healthcare. It was therefore suggested that any increase in ADT could substantially impact young people’s ability to pursue these opportunities. It was also noted that families with young children may be negatively affected by an increase in ADT.

“Young people have also raised concerns about those aged 18-25, who are often the most active in youth voice and early career opportunities but do not have the same protections as younger children. There is also concern that any increase in travel costs or reduction in routes would make it harder to maintain the progress that has been made in embedding young islanders within national structures.” – Young Islanders Network

However, some respondents highlighted the connectivity benefits for young people under the Highlands and Islands exemption and the Under-16 exemption. It was emphasised that these exemptions keep air travel affordable for young people and allow for those in rural areas to access opportunities across the UK.

Two respondents noted that increased year-on-year climate change caused by carbon emissions will have mounting negative effects on young people’s lives.

Question D3: Are you aware of any potential impacts, either positive or negative, that you consider any of the proposals in this consultation may have on the environment?

25 respondents answered Question D3. Of these respondents, seven said some variation of ‘no’. Comments that were out of scope of Question D3, such as suggestions of hypothecation, have not been included in this summary.

Five respondents expressed the view that ADT will have negligible environmental impacts, either positive or negative. One respondent noted that ADT is primarily a revenue-raising tax with exemptions designed to support connectivity, as opposed to an environmental tax.

Some respondents suggested that ADT will negatively impact the environment due to increased demand for flights to and from Scotland, or through demand leakage to non-Scottish airports therefore displacing emissions instead of reducing them.

“If ADT were to be implemented in such a way that reduced the number of routes available in Scotland, this may actually have a negative environmental impact overall, with passengers forced to take more indirect routes through hubs outside Scotland, leading to higher total emissions per journey.” – Edinburgh Chamber of Commerce

One respondent raised that the Private Jet Supplement may reduce demand and therefore lower carbon emissions.

Question D4: Are you aware of any examples of how the proposals in this consultation may impact, either positively or negatively, on those with protected characteristics?

16 respondents answered Question D4. Of these, nine said some variation of ‘no’. Comments that were out of scope of Question D4 are not included in this summary.

Some respondents noted that the Highlands and Islands exemption protects important aviation connectivity for those with protected characteristics.

However, other respondents raised concerns about increased tax burden and reduced routes negatively affecting those with protected characteristics and limited flexibility.

Question D5: Are you aware of any examples of potential impacts, either positive or negative, that you consider any of the proposals in this consultation may have on groups or areas at socio-economic disadvantage (such as income, low wealth, or area deprivation)?

20 respondents answered Question D5. Of these, six said some variation of ‘no’. Comments that were out of scope of Question D5 are not included in this summary.

Multiple respondents expressed the view that the Highlands and Islands exemption has a positive impact as it supports affordable ticket prices and keeps marginal connectivity routes viable.

“Without an exemption, the cost burden would fall more heavily on communities already facing higher costs of living and limited transport alternatives.” – Individual

However, one respondent noted that flight prices in the Highlands and Islands regions remain high and can be prohibitive even with the exemption.

Several respondents emphasised that ADT is a regressive tax that impacts those with lower incomes disproportionately.

Question D6: Are you aware of any examples of how the proposals in this consultation might impact, positively or negatively, on island communities in a way that is different from the impact on mainland or other areas?

23 respondents answered Question D6. Of these, five said some variation of ‘no’. Comments that were out of scope of Question D6 are not included in this summary.

Multiple respondents expressed the view that the Highlands and Islands exemption will have a significant positive effect, as the proposed exemption will maintain and expand protection for essential flights to and from the region.

However, several respondents highlighted that connectivity remains fragile in the Highlands and Islands and any increase in flights costs could have substantial detrimental effects on the regions.

“With the current unreliability of ferry services, the Islands population are particularly vulnerable to the costs of air travel, there being no road access to the mainland; it is a captive market and needs the maximum support.” - Individual

Question D7: Are you aware of any examples of how the proposals in this consultation might impact, either positively or negatively, on rural communities on mainland Scotland?

23 respondents answered Question D7. Of these, five said some variation of ‘no’. Comments that were out of scope of Question D7 are not included in this summary.

Several respondents highlighted the improved air connectivity that the Highlands and Islands exemption will bring to rural mainland communities.

However, it was noted that the loss of the international exemption may hinder wider connectivity beyond the UK to and from rural regions in mainland Scotland.

Some respondents also raised that that rural areas not covered by the Highlands and Islands exemption should be monitored for any negative impacts.

“Future ADT policy should avoid creating unintended disparities between remote communities that have similar accessibility challenges but fall outside the exemption boundary, and should keep the broader objective of territorial cohesion in view.” - Individual

Scottish Government Response

The Scottish Government is grateful to respondents for their input on these questions around impacts. The information provided will be factored into the Impact Assessments which will be produced alongside the relevant ADT secondary legislation prior to the implementation of the tax on 1 April 2027 and will be published on the Scottish Government website.