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IATA labels Belgian and Irish Departure Tax Proposals 'Collective Madness'

Travel News Asia Latest Travel News Podcasts Friday, 17 October 2008

IATA has criticised budget plans in Belgium and Ireland, saying they mimic British and Dutch departure taxes and labelling them as collective madness.

Collective madness is the only way to describe the EUR 150 million Irish and EUR 132 million Belgian departure tax proposals. Filling budget gaps or financing government investment in the banking industry with gratuitous travel taxes is policy myopia at its worst, said Giovanni Bisignani, IATAs Director General and CEO. 

On Tuesday, the Belgian and Irish governments announced plans to implement departure taxes in their new budgets. Combined with the proposed UK Aviation Duty and the recently implemented Dutch departure tax, by 2010 air travellers could face a tax burden of up to EUR 3.8 billion annually in these four counties alone.

The timing could not be worse for governments to make mobility more expensive. Look at what has happened in fuel, the biggest cost item for airlines. Even with the recent drop, todays price is still over 300% more expensive than it was only a few years ago, said Bisignani. Rather than collective action to squeeze taxpayers, Europes governments should be looking to improve European competitiveness. An effective Single European Sky would save 16 million tonnes of CO2 annually and improve the competitiveness of Europes skies by over EUR 5 billion.

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