The North East’s largest business organisation has warned that devolution of tax powers to Scotland could harm the North East economy.
The North East Chamber of Commerce is reacting to recommendations in the Smith Report, which explores further devolved powers given to Scotland following September’s ‘no’ vote in the country’s independence referendum.
One key issue is air passenger duty (APD) – a tax levied on flights from the UK – which the Commission proposes giving Scotland powers to alter.
NECC Policy and Research Manager, Mark Stephenson, said: “Handing the Scottish parliament powers over APD will be a slap in the face for North East business. Providing a competitive advantage to airports north of the border places our region at a disadvantage at a time when businesses are doing their level best to provide jobs and grow our economy.
“The North East is uniquely exposed to the impacts that such powers will have and it is vital that we are consulted fully before a decision is made. Reaching a fair deal for Scotland as well as in UK regions is crucial, but it makes no sense to rob Peter to pay Paul.
“The Government must set out, at the earliest opportunity, how English airports such as those close to the border will be protected should these measures be introduced.
“If we in the North East are to realize our economic ambitions and overcome our challenges then at some point the welfare of our economy must factor in decision making on Scottish, as well as English regional devolution.”