Glossary

Air Passenger Duty (APD)
is the UK government’s principal tax on the aviation sector, since, in line with the UK’s international obligations, tickets are VAT free and aviation fuel incurs no duty. The tax raised £3.6bn in 2019-20 and its primary objective is to ensure that airlines make a fair contribution to the public finances. APD is paid by airlines and is levied on a per-passenger basis on all flights departing UK airports. The rates differ according to a passenger’s class of travel and the distance of their journey.
Alcohol duty
is a long-standing system of taxes, with its origins in the 1643 Excise Ordinance levied by Parliament during the English Civil Wars. Today, it is composed of five individual taxes: beer duty, spirits duty, cider duty, wine duty and made-wine duty. These duties collectively raise over £12 billion each year, providing important revenue to fund public services. At the same time, they also help address the harms caused to society and public health by excessive or irresponsible drinking.

The Alcohol Duty Review aims to improve the current system to make it simpler, more economically rational and less administratively burdensome on businesses and HMRC.