UK Government to axe inflation-linked flight tax rise

Tuesday, 22 March 2011 00:05 - - {{hitsCtrl.values.hits}}

(Reuters) - Britain will scrap a planned inflation-linked increase on air passenger duty this year, a government source.

The flight tax had been due to rise in line with retail price inflation in November.

The decision not to implement the hike will cost the government coffers about 150 million pounds, saving a family of four about 16 pounds on a trip to South Africa or 12 pounds on a journey to the United States.

“The government wants to give extra help to hard-pressed families,” the source said.

Chancellor George Osborne has little room for sweeteners in his budget Wednesday, but the government is expected to exempt more workers from paying income tax, fund training for the young unemployed and help motorists cope with high petrol prices.

Osborne will stick to his austerity plans aimed at slaying the bulk of a record budget deficit -- running at about 10 percent of national output -- by the next election in 2015.