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IATA protests German tax

9-Jun-2010 8:07 AM

IATA Director General and CEO, Giovanni Bisignani, labelled (08-Jun-2010) the new departure tax in Germany as "the worst kind of short-sighted policy irresponsibility". IATA estimates it will add a EUR 1 billion p/a burden on aviation. [more]

  • Airline responses: Air Berlin CEO, Joachim Hunold, stated the carrier was “very surprised” when the tax was announced (Bloomberg, 08-Jun-2010). The CEO added the Dutch Government’s withdrawal of a similar tax after one year proves the measure will not improve revenue, as “competition will go over the border and perhaps some other carriers will get the benefit”. Lufthansa CEO, Wolfgang Mayrhuber, meanwhile stated the tax will burden the country’s airlines with “more than what all of them together earn in a year” and the fee will have “consequences”. He added there was “no way” the carrier would pass the tax on to passengers (Reuters, 08-Jun-2010).
  • Airport responses: LDV warned that traffic in Germany could drop by up to 3% as a result of the tax, as passengers seek cheaper fares to neighbouring countries.

IATA: “[This is] 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 caused. The proposal should be axed. It is the wrong measure at the wrong time; and it ignores the lessons learned from the failure of a similar tax in the Netherlands,” Giovanni Bisignani, Director General and CEO. Source: IATA, 08-Jun-2010.