Iata condemns sudden Italian air tax hike

Iata condemns sudden Italian air tax hike

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A sudden increase in Italy’s air passenger tax will damage the country’s economic competitiveness and result in 2,300 jobs a year being lost, claims Iata.

The warning came as the airline trade body condemned the tax hike of 33%-38% which amounts to an extra €2.50 per passenger.

Passengers will pay €10 in tax each time they fly from airports near Rome, and €9 for flights from other Italian airports.

None of the revenue raised from the tax is re-invested in aviation - instead it is diverted for general purposes.

Iata complained that the tax hike was being imposed without any advance warning or consultation.

The organisation’s European regional vice president, Rafael Schvartzman, said: "This sudden jump in the cost of flying from Italy can only cause harm to the Italian people and its economy.

“The increase in the tax will reduce passenger numbers by over 755,000 and GDP by €146 million per year. 2,300 jobs a year will be lost, meaning that by the end of the decade over 9,000 jobs will have been needlessly squandered.

“Rather than increase this inefficient and ineffective tax, the Italian government should urgently enact policies to encourage the growth of air transport links, which are proven to enhance employment, innovation and cultural activities.

“The government should start with a full-scale review of the economic basis of the tax, with a view to its complete removal. Airlines and passengers should not become an easy source of income for any government."

Experience elsewhere in Europe, such as in the Netherlands and Ireland, show removal of taxation boosts traffic and benefits the economy of the country. Italy has a number of other taxation and regulation issues which IATA is calling on the Government to reform, to enhance competitiveness.

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