Global airlines slam new German departure tax

8th June 2010, Comments 0 comments

The global airline sector took aim on Tuesday at a proposed tax on passengers leaving German airports, saying it would create more turbulence just when the industry sees a smoother ride ahead.

"This is the worst kind of short-sighted policy irresponsibility. It's a cash-grab by a cash-strapped government," said Giovanni Bisignani, the director general of the International Air Transport Association (IATA) in Berlin.

"This is not the time to burden the aviation industry with more taxes ... this tax is a body blow to the weak economy and a fragile industry," he added.

"And it is a kick in the teeth to travellers when they can least afford it."

The tax, outlined in Berlin on Monday as part of a multi-billion package of belt-tightening measures, is set to run until the carbon-emissions trading scheme that has already been agreed comes into effect for air travel in 2012.

"There will be a national ecological air travel levy for all passengers who depart from domestic airports. It will be made up of different elements (price, noise, usage)," German Chancellor Angela Merkel's proposals said.

Bisignani said the tax could bring in about one billion euros annually.

He denied it would have any environmental benefit, and criticised Merkel directly for imposing the tax.

"If this is related to the environment ... I would like the chancellor to say to us, where is the investment? How many trees is she planting with this one billion?" he said.

The chief executive of German flag carrier Lufthansa, Europe's biggest airline by passenger numbers, also attacked the tax.

"What we don't need is an extra burden to slow us down," said Wolfgang Mayrhuber.

Their comments came after IATA, which represents 230 airlines and 93 percent of air traffic, said the industry would be in profit this year for the first time since 2007.

"We are upgrading our global industry forecast to a full-year profit of 2.5 billion dollars," Bisignani told reporters on Monday.

In March, the association had estimated its members would post a loss of about 2.8 billion dollars this year, following a massive drop of 9.4 billion dollars in 2009.

Merkel unveiled the tax as part of a raft of unpopular measures to tackle the country's ballooning deficit and debt problems.

By 2014, the government hopes to cut 86 billion euros (102 billion dollars) in spending, Merkel said, with around 11.2 billion euros in savings in next year's budget.

© 2010 AFP

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