2. Subsection (1) provides for the amendment of section 30 of the Finance Act 1994.

3. Subsection (2) amends subsection (1) of section 30 of the Finance Act 1994 in consequence of the changes made by the remainder of the clause.

4. Subsection 3 amends subsection (2) of section 30 of the Finance Act 1994 so that if a passenger’s journey ends at a destination within the EEA then the applicable rate of duty will be determined by the new subsection (3A).

5. Subsection 4 inserts new subsection (3A) into section 30 of the Finance Act 1994. This subsection provides that when a passenger’s journey ends at an EEA destination then the rate of duty will be £5 if the passenger is booked to travel in standard class in relation to every flight on his journey, or £10 in any other case.

6. Subsection (5) provides that where the passenger’s journey does not end within the EEA the rate of duty will be £20 if the passenger is booked to travel in standard class in relation to every flight on his journey, or £40 in any other case.

7. Subsection (6) inserts new subsection (10) into section 30 of the Finance Act 1994. This defines "standard class of travel" as meaning the lowest class of travel available on a plane. Where there is only one class of travel on a plane then that is standard class.

8. Subsection (7) makes consequential amendments to section 39 of the Finance Act 1994 (section 39 provides for schemes for simplifying reliefs from Air Passenger Duty and other related matters).

9. Subsection (8) provides for the section to apply to the carriage of a passenger on an aircraft which begins on or after 1 April 2000.

10. The Government has announced that from 1 April 2001 it will introduce a new duty structure for air passenger duty. There will be standard duty rates of £10 for EEA destinations and £40 for other destinations. Duty on the lowest class of travel on any flight within the EEA will be halved from £10 to £5. Duty on the lowest class of travel on flights to destinations outside the EEA will be £20. These changes will make the duty fairer by bringing the rate of duty more in line with the cost of travel.

12. These changes will not come into effect until 1 April 2001, to allow airlines and tour operators plenty of time to adjust their marketing and pricing strategies to the new structure.