27.This section provides a tax exemption for the carriage of passengers on an aircraft that is being operated under a public service obligation (“PSO”) imposed under European Union law. PSOs enable routes to isolated communities to be sustained by the provision of government subsidies. The effect of section 9(1), in the light of the PSOs that are currently in place in Scotland, is that no ADT would be payable for the carriage of passengers on aircraft used:
on flights subsidised by the Scottish Government on routes that connect Glasgow with Barra, Tiree or Campbeltown;
on flights subsidised by Scottish local authorities on routes within Shetland, Orkney and the areas of Comhairle nan Eilean Siar and Argyll and Bute Council; or
the Dundee to London Stansted service subsidised by a partnership of Dundee City Council, the UK Government and Transport Scotland.