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A mysterious £8.90 tax is being added to all Heathrow flights

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A mysterious new tax is being added to all flights booked from London Heathrow. It started on Friday.

You will see it on your taxes breakdown as R1. Here is an example on an Economy flight from London to Rome:

The description for the charge says:


It appears to be £8.90 irrespective of whether you are flying short-haul or long-haul.

It applies to all airlines flying from Heathrow, but only from Heathrow. It is not added to inbound flights.

It is not linked to the standard ‘Passenger Service Charge’ or ‘Air Passenger Duty’, which continue to be charged at standard rates as the screenshot above shows.

This may be linked to Heathrow’s demand to have its covid losses repaid by passengers (see our other story today) but it seems unlikely as this requires authorisation by the Civil Aviation Authority.

We will update this article when we get a proper answer. Whatever the answer is, your next flight just got £8.90 more expensive.

Whilst existing ticket holders will not be asked for any additional money, British Airways may ask you to pay it if you make a change to an existing booking.

PS. We now have the answer, which is on page 6 of this document.

Put simply, Heathrow’s agreement with the airlines guarantees that they, and not the airport, will pay 100% of certain airport costs. With sharply reduced passenger numbers, the fees paid by airlines have not been high enough to cover these costs.

The £8.90 surcharge covers the loss Heathrow made in 2020 on providing certain services, as well as its estimate of on-going losses. The surcharge will, in theory, disappear when passenger volumes return to normal and the backlog of underpayments has been cleared.

Heathrow told us in a statement:

“Heathrow provides key airport services like the baggage system, colleague car parks, airline check-in desks and utilities for our partners to use. The fee to use these services is calculated purely to cover the cost of providing them – Heathrow makes absolutely zero profit from these services. To ensure this remains the case, the fee is closely monitored by the CAA, as well as being scrutinised and agreed with airport users annually – as was the case with this year’s charge. The cost per passenger to cover these services naturally fluctuates depending on the number of passengers using the airport.”

Comments (71)

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  • Track says:

    Travel industry should be rightly worried.

    • Brian says:

      When things eventually open up, whenever that is, people will be desperate for a holiday abroad after spending a couple of summers in Bognor. £8 won’t make much of a difference.

    • Chrisasaurus says:

      While that is true, £9 is not their biggest headache right now. Nobody flying this or next quarter is the least bit price sensitive…

  • M Baldrick says:

    My flights for end of March were cancelled yesterday were cancelled so I was forced to change to end of April. I was told I had to pay and additional £10 something for each person and my card would be charged £20 and some pence. When i asked what it was for I wasn’t given an explanation just extra charges. I took as because it had gone into April it was something to do with new taxes. So if you think you won’t be charged for changing even though enforced you are wrong. I did!

    • Charlieface says:

      You should not have paid. If your flight is cancelled the airline need to cover the cost of a new ticket

    • TGLoyalty says:

      It’s your legal right to rebook for FREE if a £20 charge appears (I hope it doesn’t) I would phone back and demand a refund.

      I completely understand it’s only £20 but as a point of principle it should be free and you were lied to.

  • George says:

    Probably airlines preemptively adding to the charge to tickets from April in the assumption that the CAA will rule in Heathrow’s favour in March

    • JDB says:

      This charge is totally separate from the CAA’s decision to come in July (last consultations close in March). As its name implies, the £8.90 under recovery charge is clawing back regulated charges that were previously under collected owing to the unprecedented shortfall in passengers. It isn’t some windfall; it is simply how Heathrow’s regulatory structure, set by the CAA, works.

      • PhatGit says:

        How is it totally separate? If Heathrow are now seeking to cover turnover rather than just profit, won’t the payments that the airlines pay to cover services also be in that turnover? Sounds a bit like double bubble to me

        • Rob says:

          That is true. Heathrow’s £2.8 billion is just plucked out the air anyway. They have, for a start, fired so many people that their cost base is a fraction of what it was. They also have few day to day costs.

          • TGLoyalty says:

            Typical negotiation tactic when you have a monopoly start stupidly high then meet somewhere you think was actually reasonable.

            In my field we wouldn’t entertain funding anything but actual fixed costs not recovered. You can get lost if you ask for “lost profit”

  • insider says:

    Heathrow have been trying desperately hard to not lose out because of Covid and push all the losses onto the airlines and consumers. Whilst this is just a result of the formula that allows them to recover charges for things they haven’t managed to cut the cost of in 2020/21 (outside of the single till), they are still pushing hard to make sure the CAA cave in to their demands and allow them to increase the usage charge of Heathrow for the next 20 or so years

  • RajBad says:

    Flying will change for the better post COVID!

  • ChrisC says:

    “This charge had been introduced at the request of the airlines …”

    Page 6 of the linked document.

    More should be made of this fact,

    • Lux says:

      Can you imagine that meeting though!

    • kitten says:

      In other words their contracts aren’t structured to allow Heathrow to grab all the money they want from airlines, or regulation rightly caps what they can grab, or the airlines told Heathrow to S*d *ff ! and so here is little Heathrow that business whose monopoly profits are privatised, abusing consumers instead.

      Take aviation market supervision and consumer protection away from the.CAA if they too don’t tell Heathrow look to your own business resources available and No you may not use your monopoly position to abuse passengers.

      While they’re about it they can tell them to maintain the free bus service if they want to have any form of car access charge for any airport.

  • Julian says:

    The government has wasted all this money on making people completely unproductive on Furlough yet won’t bail out the airports on their losses from loss of revenue from customers flying, which is plain (not the other sort of plane) stupid. Similarly they are reintroducing full VAT and full Stamp Duty on houses when the economy is plainly still a very long way away from going completely back to normal.

    Post the lock down huge numbers of people who have any choice aren’t going to fly until all the nonsense with a test before you go away, when you get there, after you have quarantined for x days from arrivale and another test x days before your return and another test on arrival home followed by quarantine at home, even if not in a guarded hotel for the majority (as a most extreme case) goes away.

    Trying to recover their losses from potential customers on an absurd flat rate per flight basis (which is ridiculous as that means they are penalising flying short haul far more) is just going to crucify the chances of people returning to flying in large numbers any time soon far more.

    Also Heathrow now has competition from other airports and I am sure that Gatwick would jump at the chance to get their close parallel runway through planning and built as soon as possible and so massively damage the potential returns on Heathrow’s third runway, given that so far despite COVID every possible effort has been made to defend slots and keep lower cost Easyjet, Ryanair and Wizz out of Heathrow on the rash assumption that things will go back to exactly how they were before in the near future while passengers are still required to jump through these numerous highly obstructive hoops to getting on a flight.

    Well only time will tell if this is a strategy that works I suppose………….

    • sloth says:

      why should the government bail out airports on their losses? thats what shareholders are for…heathrow is my closest airport (15 miles) but I recognise they are not the only airport

      • Brian says:

        To be fair, the Qatar and Chinese governments probably don’t have the money, hence why the need a U.K. government bailout. Oh wait.

      • Rob says:

        Heathrow is not allowed to charge what it wants. It is subject to price caps to stop it abusing its market position. Simplistically, it believes that as its profits are capped then its losses should be capped too.

        • memesweeper says:

          Simplistically, if it goes bust, who cares? Administrators step in and it’s sold on as a going concern. The shareholders should suck it up, or sell out.

        • sloth says:

          juts because its what Heathrow believes, doest make it right…eod the shareholders bought into the company knowing the capped prices situation…

    • kitten says:

      Julian : people being supported through furlough and publically availablw benefits is one thing

      Businesses are supposed to manage themselves using the multiplicity of commercial solutions available to them. Those businesses that have been doted the ability to collect rents off a monopoly position should not be allowed to abuse consumers.

      • kitten says:

        Private equity could suggest many solutions here far, far before any suggestion of allowing Heathrow to abuse consumers given the monopoly profits they have enjoyed.

        I hope Heathrow goes bust. As another poster says there will be others that are prepared to take up the assets.

  • Steve says:

    Is this extra £8.90 going to be added to the cost of Avios redemptions?

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