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IATA releases report into economic benefits of abolition of Ethiopian jet fuel taxes

19-Sep-2013 3:23 PM

IATA released (06-Aug-2013) an economic briefing into the impact of abolishing the stabilisation fund levy and excise tax on jet fuel in Ethiopia, with the following highlights:

  • As a result of abolition, economic benefits to air travellers to and from Ethiopia would increase by USD62.5 million and foreign visitor arrivals would be boosted by over 35,000. In addition, the industry’s overall contribution to GDP would rise by about USD176 million and an additional 111,931 jobs would be supported in Ethiopia. Ethiopia would also attract 10-22% additional transit passengers as well as have increases in air freight volumes;
  • IATA estimates that abolishing the stabilisation fund levy and excise tax on jet fuel will on average decrease the operating cost of international passenger services by about 5.5% for services to and from Ethiopia;
    • IATA forecast such a decrease would result in an increase in foreign arrivals by air of approximately 5.6%, or the equivalent of over 35,000 foreign visitor arrivals;
  • IATA forecast that following the removal of the stabilisation fund levy and excise tax, international air travellers to and from Ethiopia will annually accrue additional net consumer benefits of about USD 62.5 million, with half of this benefit, or about USD 31.3 million, accruing directly to residents of Ethiopia;
  • As a result of abolition, the industry’s overall contribution to GDP would rise by about USD176 million and an additional 111,931 jobs would be supported in Ethiopia. IATA said its estimate was "conservative", as it does not include impacts from an increase in travellers originating from Ethiopia and does not quantify the impacts on government revenues. [more - original PR]