Ryanair has criticised a new aviation tax that has been imposed on a European country and urged it to be abandoned as the airline outlined its impact on travel and tourists
Ryanair has slammed a new aviation tax imposed by a European hotspot(Image: Getty Images)
Ryanair has slammed the new aviation tax imposed on a major holiday hotspot and urged it to be ditched in a bid to boost visitor numbers.
The beautiful country of Austria offers a scenic escape, thanks to its dramatic backdrops of snow-capped mountains, mirrored lakes, alpine forests, rolling hills, national parks, and fairy-tale-like villages. Vienna, Salzburg and Hallstatt are among the most popular destinations for Brits.
According to the outspoken people at budget airline Ryanair, a €12 (£10.39) aviation tax imposed by the countries could severely impact airlines and, in turn, travel to the country.
Ryanair claimed the tax will see airlines such as Wizz Air, Level and easyJet “abandon Austria”, although it’s worth noting these other airlines have not issued statements to this effect. Two of Austria’s biggest airlines, AUA and Ryanair, have cut their capacity and closed routes, opting for “lower-cost neighbouring countries” such as Albania, Italy and Slovakia, according to Ryanair. The airline has long been a vocal opponent of many different forms of aviation taxes, despite a post-tax profit of £1.31 billion last year, according to AJ Bell.
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Earlier this week, Ryanair called on the Government of Austria to ditch its €12 aviation tax by May 1, over concerns that it could lead to a “decline in airlines, routes and traffic serving Austrian airports”. The airline noted that the €12 tax has made “Austria uncompetitive”, as countries such as Albania, Italy and Slovakia have opted to revoke aviation taxes, lower ATC fees, and introduce growth incentive schemes to help reduce airport costs for airlines.
Ryanair has demanded that the €12 aviation tax is axed by the Austrian government, or else claims that it won’t invest in the country. The airline says it has a $1 billion (£740 million) growth plan, which could include basing 10 new B737 aircraft based in Vienna. If these proposed plans went ahead, Ryanair says the country’s traffic would grow by 70%, to 12 million passengers within the next five years.
As much as Ryanair’s bosses may not like the levy, the aviation industry has long benefitted from generous tax breaks. Even now, no fuel duty is paid on jet fuel, and no VAT is applied. This is in sharp contrast to other modes of transport. When it comes to driving in the UK, petrol is hit with a levy of 52.95 pence per litre, as well as 20% VAT.
“Aviation’s exemption from fuel duty and VAT appears more like an indirect subsidy that allows airfares to be kept artificially low. The absence of tax has helped to fuel passenger growth and the sector’s CO2 emissions have increased 125% since 1990. Over the same period, the UK’s overall emissions decreased by 43%,” writes the Aviation Environment Federation.
In a statement released on April 21, the CEO of Ryanair, Michael O’Leary, said: “Today we call again on Chancellor Stocker and Transport Minister Hanke to abandon their failed high tax policies. Austria has become totally uncompetitive, and is losing aircraft, routes and traffic to lower cost alternatives like Slovakia, Albania and Regional Italy. Even Sweden, the home of Greta Thunberg and flight shaming, has now abolished its aviation tax.
“Meanwhile, Austria has the highest aviation taxes, the highest ATC fees, and Vienna Airport has abandoned its growth incentive schemes, making Austria and Vienna hopelessly uncompetitive at a time when neighbours such as Slovakia have abolished aviation taxes, slashed ATC fees, and have lowered airport charges through growth incentive schemes, which Vienna Airport used to offer, but no longer does.
“The solution to Austria’s aviation crisis is clear. We need leadership and we need action. Abolish Austria’s harmful €12 aviation tax, cut Austria’s expensive ATC fees immediately by 50% to make them competitive with neighbouring Slovakia, and demand that Vienna Airport reinstate the growth incentive schemes, which were such a success when Vienna introduced them 8 years ago.
“Ryanair can and will deliver rapid traffic and tourism growth for Vienna, but only when Austria offers a competitive cost base to that currently offered in Slovakia, Albania and Regional Italy. Until such time as it does, it is inevitable that Austria will continue to lose aircraft, routes, traffic and jobs to lower cost countries, while “Sleepy Stocker” and “Hopeless Hanke” fiddle around with “reform” of the aviation tax, when what it needs, is abolition.
“It’s time for action from the Stocker Govt, and we call on them to abolish this stupid aviation tax on 1 May next, and give Austria an opportunity to recover the traffic, tourism and jobs it has lost as a result of its high tax policy over recent years.”
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