O’Leary blames tax for cuts to Ryanair German flights in 2011

15.12.2010 (Scotsman – business)

[Ryanair’s take on things. More likely to be that they cannot make enough money
on the routes].


Budget airline Ryanair yesterday blamed a new German tourist tax for its decision
to axe 34 routes from its schedule next summer.
Flights connecting Liverpool to Bremen and Birmingham to Dusseldorf are among
those to be scrapped as a result of Germany’s €8 ( £6.79) tax on flights, which
comes into effect at the start of January.

Ryanair flights between Kerry in Ireland and Dusseldorf  will also be stopped
as part of reductions in its German operation next year although no flights from
Scottish airports will be affected.

The airline said its decision to make “deep cuts” to its business in Germany
will cost an estimated 3,000 jobs across the industry and reduce the number of
passengers it flies in the country by three million a year.

Ryanair boss Michael O’Leary urged the German government to rethink the tax,
which he said would damage the country’s economy.

He called on Germany to follow the example set by Ireland, which last week announced
it would reduce its tourist tax from €10 to €3 in March.

O’Leary said: “The German government’s €8 tourist tax continues to inflict significant
damage on traffic, tourism and jobs in Germany.

“International experience shows that tourist taxes caused a large traffic and
tourism collapse in both Ireland and the UK and we believe that this ill-advised
tax will inflict similar damage to German tourism and jobs”.

see also

Ireland to go for flat rate flight tax of €3 from March to December 2011

10th December 2010       The Irish Government stopped short of axeing the controversial air travel tax
but instead changed it to a flat rate of €3. Previously the charge was €2 for
a short flight (less than 300km) and €10 for a long-haul flight. Finance Minister
Brian Lenihan said the move, which takes effect from March, would help the tourism
industry which has taken a hit in the past year. It will be reviewed next year.
Tourist numbers to Ireland less hugely during 2010.         Click here to view full story…

see also

Austria to introduce flight departure eco-tax – €8 for short haul €40 long haul


Austria looks likely to follow Germany and introduce a departure tax in the near
future.   The exact date has yet to be announced but it could be as early next
year. Passengers departing from an airport in Austria will pay €8 for short-haul
and €40 for long-haul flights.   As in Germany, it is expected that the new tax
won’t be payable by transit passengers. In September Germany announced that an
air travel levy, to be paid on all departures from German airports as of January
1st 2011, is expected to raise €1 billion a year. The charge will be €8 for flights
within Germany and short-haul European flights, while for medium-haul flights
the fee will be €25 and for long-haul €45.

The European group, Transport & Environment, has put together a useful table,
showing indicative charges on flights in different EU countries. It appears, including
Austria & Germany, that 59% of the EU aviation market is already covered by
ticket taxes; UK alone is roughly 25% of the market.

Chart showing the charges across various European countries, page 7 of http://www.aef.org.uk/downloads//AirportWatch_bulletin_Nov_2010.pdf

www.transportenvironment.org           http://bit.ly/esVi7P for more on the Austrian and German taxes

see also


Austria to introduce flight departure eco-tax – €8 for short haul €40 long haul





2.11.2010 (ABTN)

by Alex Mcwhirter

Austria looks likely to follow its neighbour Germany and introduce a departure
tax in the near future.  The exact date has yet to be announced but it could be
as early next year.

It means that passengers departing from an airport in Austria will have to pay
an "eco" tax of €8 for short-haul and €40 for long-haul flights.

The UK business person travelling on a round-trip ticket from London to Vienna
will have to pay an additional €8.   But as in the case of Germany it is expected
that the new tax will not be payable by transit passengers.  

This is important because the business model of home carrier Austrian Airlines
is geared around flying passengers between destinations in Western Europe on the
one hand and Central, Eastern Europe and Russia on the other via its Vienna hub.

As might be expected, the European airlines’ trade body AEA is highly critical
of the new tax and believes its sole purpose is to plug a budget deficit rather
than reduce carbon emissions.

"If the intention is to boost fiscal revenues, I fear the Austrian government
may find it has got its sums wrong," said AEA secretary general Ulrich Schulte-Strathaus.

"They should learn the lesson of the Netherlands, which abandoned its own passenger tax in 2009 after just 12 months, when it was discovered it had cost the economy a billion
euros in return for just Euros 300 million in revenues."

In the Dutch case, many travellers  chose to board their flights in nearby countries
with Dusseldorf and Brussels being popular.  Amsterdam airport has said that 1.3
million passengers were lost.  

But this is more difficult in the case of Austria. Granted travellers based near
the Swiss border might opt for Zurich and those near Vienna might consider nearby
Bratislava in Slovakia.

But there is a limited range of short-haul flights from Bratislava. Most are
with Ryanair rather than big national carriers like Air France, British Airways
or Lufthansa.  It means that interlining facilities at another European hub are
not possible (Ryanair does not offer facilities for through-checking). Bratislava
has no long distance flights at all.  

However, if the airlines see more demand at Bratislava extra services may appear.




see also


Austria follows the lead of Germany with new environmental tax on departing passengers

Greenair online     28.10.2010

Following on the heels of Germany, Austria is the latest to announce that it
too would introduce an ecological tax to be paid by all airline passengers departing
from the country’s airports. Passengers will be charged 8 euros ($11) for intra-European
flights and 40 euros ($55) for long-haul flights.

The tax is expected to raise between 40 and 60 million euros in 2011.   Airline
representatives have accused the Austrian government of following other EU states
like Germany and the UK in using the environment as a thinly-disguised revenue
earner.   Speaking at the recent President’s Assembly of the Association of European
Airlines (AEA), British Airways CEO and AEA Chairman for 2010 Willie Walsh said
Europe’s airlines would not be able to compete abroad if weighed down by taxes
and charges at home.

Austria’s ruling federal coalition unveiled the departure tax as part of a wider
austerity package of new taxes, including on petrol, and spending cuts.   It follows
the introduction of departure fees ranging between 8 euros and 45 euros by the
German government on 1 September.

Sylviane Lust, Director General of the International Air Carrier Association
(IACA), which represents 33 airlines serving the leisure industry, said: "This
is an obvious attempt by the Austrian government to jump on the same band wagon
as Germany and introduce a thinly-disguised ecological tax to take money from
airline passengers for their own coffers. The plans for this tax seem to have
been announced without any consideration for the effect on airlines, passengers,
the economy and the environment.

"These types of taxes are not the way to reduce aviation emissions.   European
governments would be better off spending their time trying to achieve the Single
European Sky, which will have a much greater impact on lessening emissions in

"The news comes at the end of a very difficult year for airlines and carriers
can ill-afford any additional pressure on passenger demand.

"This type of tax is spreading across Europe.   It has been withdrawn in the Netherlands
after passengers sought alternative airports to depart from to avoid paying the

"I would urge the Austrian government to re-consider its plans to introduce this
ill-conceived ticket tax."

Also condemning the move, AEA (Assoc of European Airlines) spokesman David Henderson
said: "It is manifestly not an environmental levy, it is a means to reduce a budget
deficit in the wake of the economic downturn, the banking crisis and the rescue
package for the Euro. It is unfortunate that any tax proposal nowadays seeks to
justify itself with the ‘eco’ label.

"It will hurt Austrian citizens and it will hurt Austrian business – which was
discovered by the Dutch when they introduced, and subsequently withdrew, their
own travel tax – and which was recognized by the Belgians when they abandoned
their own proposals.  It is all the more remarkable in the case of Austria, where
Bratislava Airport is just 80km and less than an hour’s drive from the centre
of Vienna – although I have no doubt that the highway between the two will see
a heavy increase in traffic.

"It’s all the more ironic that the ‘Bruges Declaration’ which accompanied the
European Aviation Summit just ended, sees the necessity to ‘maintain and improve
a competitive European aviation industry … in that context, avoid additional burdens
(for example, taxes on aviation) affecting European carriers’ competitiveness’.  
Mixed messages indeed."

Meanwhile, Europe’s largest low-cost airline Ryanair is to cut more than a quarter
of its flights from its Frankfurt Hahn base, blaming the introduction of the German
‘eco’ passenger departure tax. The airline said the new tax made the country an
uncompetitive tourist destination. It suggested the German government should consider
the damaging impact of similar taxes imposed elsewhere in Europe and withdraw
its departure tax.

Speaking on behalf of AEA members at the association’s recent President’s Assembly,
British Airways CEO Willie Walsh said: "Our success is Europe’s success. But if
we are weighed down by taxes and charges at home, we can’t compete to the best
of our ability abroad.  We cannot compete sustainably for passengers, if, as a
result of government intervention, non-European hubs benefit, thereby drawing
passengers, cargo, employment and economic growth away from Europe."

Links:     International Air Carrier Association   Association of European Airlines




see also


Germany introduces air passenger tax

 ABTN     2.9.2010


The German government has approved the controversial green tax on air travel.

The air travel levy, which must be paid on all departures from German airport
as of January 1, is expected to raise €1 billion a year.

Passengers will be forced to pay €8 for flights within Germany and short-haul
European flights, while for medium-haul flights the fee will be €25 and for long-haul

Budget carrier Germanwings condemned the new tax as a major distortion of competition,
as passengers will choose to fly with airlines outside of Germany.

Thomas Winkelmann, Germanwings management spokesman, said: “It places jobs at
risk, restricts people’s mobility and acts as a brake on economic recovery in
our country. The winners with this new levy are the airports in Holland, Belgium,
Poland and Switzerland.”

Passengers will lose out, he added: “We will have to pass on the levy introduced
by the government to our customers. The levy drains economic power out of Germany
and displaces it into neighbouring countries.”

Giovanni Bisignani, CEO of the International Air Transport Association (IATA),
called the tax “short-sighted policy irresponsibility”.

He said: “It’s a cash-grab by a cash-strapped government. Painting it green adds
insult to injury. There will be no environmental benefit from the economic damage

According to Bisignani, when the Dutch government tried to raise €300 million
with a similar tax, it cost the Dutch economy €1.2 billion in lost business.

“It also failed as an environmental measure,” he said, “sending travelers across
the border to start their journey from more tax-sensible regimes. The Dutch had
the good sense to repeal their tax. Why repeat past mistakes?”




see also


Dutch Government ditches eco ticket tax in efforts to halt declining traffic
at Amsterdam Schiphol

30.3.2009   (Greenair online)

The Dutch Government is to scrap from July 1 its air passenger ticket tax, first
dubbed the ‘eco’ tax when it was introduced against major opposition by aviation
and local industry last year. The controversial departure tax, which ranges from
11 to 45 euros, is blamed for a steep decline in passenger traffic at the main
Dutch airports, particularly at Amsterdam Schiphol. The move was welcomed by airlines,
particularly those from the low-cost sector, who called for similar taxes to be
abandoned in Italy, Ireland and the UK.
The tax was expected to raise around €300 million ($395m) a year but a commissioned
report concluded that it would cost the Dutch economy €1.3 billion ($1.7bn) in
lost revenue. At a time when the Government was trying to underpin the economy,
reports aviationwatch.eu, the Dutch transport ministry, backed by the aviation
industry, business, tourism and right-wing parties, won the day against the environment
ministry that had fought to keep the tax.
Schiphol Group, which operates Amsterdam Schiphol, Eindhoven, Rotterdam and Lelystad
airports, said it had been hit by a strong decline in traffic and increasing international
competition, and recently announced cuts in its work force of 10-25% by the end
of next year. Schiphol Airport, Europe’s fifth biggest in terms of passenger enplanements,
recorded a drop of 430,000 passengers in February, a 13.7% fall against the same
month a year ago. The number of locally boarding passengers fell by 17.7%. The
number of transfer passengers, who were exempted from the tax, declined by 8.5%.
The airport operator along with Dutch carrier KLM had previously warned that
potential passengers would try to avoid the tax by flying from airports across
the border in Belgium or Germany. The Belgian Government has already abandoned
a proposal to introduce a similar tax.
The European Low Fares Airline Association (ELFAA) welcomed the "enlightened"
decision to lift the tax, claiming it was discriminatory in that it was only levied
on passengers starting their journey in the Netherlands and exempted cargo flights
and transfer passengers. It urged the governments of Italy, Ireland and the United
Kingdom to follow the Dutch lead in dropping airline passenger taxes.
Major low-cost operators including Ryanair, easyJet and Flybe voiced similar
sentiments. "Ryanair has campaigned against high airport taxes and so called ‘eco’
taxes, which deter visitors and has cost the Dutch tourism industry millions in
lost revenue," said a spokesman for the carrier.
Schiphol Group       Aviationwatch.eu           ELFAA