More taxes on air travel?

[320DRIVER]

EU ministers ponder tax on flying

Could a tax on jet fuel generate development cash?

A new air travel tax to fund aid for the world's poor will be among
the proposals discussed at the European finance ministers' meeting. They will also use the informal two-day session to talk about European economic growth and redesigning euro coins to reflect the enlarged European Union.

The Franco-German proposal for an aviation tax comes in two versions- either as a tax on jet fuel or tickets. The two-day meeting "is not a decision making forum", an EU spokesman said.

The tax was "one of number of proposals" for ways to meet the EU's anti-poverty pledges under the Millennium Development Goals, he told the BBC News website.

The Millennium goals set the target of halving poverty worldwide by 2015.

Shaky core

On Friday, an opening session of ministers from the 12-nation eurozone weighed up the region's patchy economic outlook and high oil prices, before the 25-member talks on Saturday.

"We're seriously concerned by the situation," said the meeting's chair, Jean-Claude Juncker, the prime minister of Luxembourg, after initial talks on Friday.

Earlier this week, Italy slipped into recession, though Germany, the euro zone's biggest economy, revealed better-than-expected growth of 0.1% for the first three months of 2005.

EU Monetary Affairs Commissioner Joaquin Almunia said the ministers had "talked about some good news and some bad news" on growth, oil prices and exchange rates.

"The bottom line would have to be described as mixed feelings," he said.

The 12 ministers agreed to expand the map on euro coins so as not to exclude newer member states who hope to join the euro, though the changes will be phased in gradually.

Aid to world poor

Discussions on fighting world poverty on Saturday are part of preparations for a United Nations summit in September to review progress on the Millennium goals.

"The aim is to go to the United Nations with a common EU position," the EU spokesman told the BBC news website.

Other anti-poverty ideas include UK-backed plans to fund an International Finance Facility (IFF) to help deal with debt in the developing world, and ways to ensure aid is used more efficiently.

The EU has promised any aviation tax would be passed only after full consultation with airlines to avoid hurting competitiveness.

Airlines believe a jet fuel tax, in particular, could hurt profits at a time when they are already struggling with high oil prices.

At present, the fuel used by airlines enjoys either a very low tax rate or is untaxed in EU member states.

[419]

"Scrapping Swazilands debt when the King is reported to be buying a private jet at twice the cost of the national health budget serves only to encourage further profligacy. Scrapping Zimbabwes debt with that regimes policies is tantamount to rewarding the ruling elite for the destruction of the economy. Chad recently embarrassed the donor community by spending proceeds from the new oil pipeline on military equipment. Tanzania - a current darling of the donor community - is embroiled in a controversial plan to purchase military radar equipment at great cost to one of the worlds poorest countries. "

"The International Monetary Fund has agreed to relieve Uganda of some $640m of debt, despite a controversy over the country's decision to spend $35m on a private aircraft for the exclusive use of President Museveni. "

Isn't it good to know that if the plan goes ahead, at least the money won't be wasted.

[Avman]

Absolutely correct 419! And this is only one example of far too many.

[zed3]

This is going to go on and on , especially with this goody goody ( our money ) EC soviet . HARRUMPH ! One has to be cruel to be kind ..... or has that been forgotten ?

[MarkD]

Perhaps the airlines should be handing out leaflets to their passengers explaining why their flights are about to get more expensive and supplying postage paid envelopes to their MPs?

[luoto]

I think that the idea of envelopes on board would be a good one, along with an example showing just how much taxation is spent. But most airlines don't have the balls to do it for various reasons.

Relief of debt sounds nice, but maybe charity must start at home. And certainly not to provide 35m gbp jets for leaders/dictators.

But look at the travel ban for Bob Mugabe in the EU. As effective as a chocolate fireguard.

But then the EU is a bastion of financial transparancy and accountability, isn't it.

[ExSimGuy]

If you travel on an "ID00" (free, staff/family, ticket) the whole tax thing opens up.

When I leave Gatwick for USA, the BAA (or whoever operates the airport these days) charges me UK25.00 for using their airport (this is usually "hidden" in the fare-payer's ticket price,unless you look carefully)

But if I pay (the airline) for an "upgrade voucher" to enable me to travel in a premium seat if "coach" is full, the AIRPORT charges me UK50.00 - why? Does LGW give me any extra service if I'm "business" or "First"??

And if I get onto the economy seat (or can't get one "up front"), does LGW refund the UK25.00 that they have "over-charged"? - No!

If I was a "regular fare-paying pax, I'd think all this extra money was going to the airline (didn't read the "cost summary" printed on the ticket - try it some time - there's more lines of taxes than the ticket has space for) :mad:

[ATNotts]

The title "More taxes on Air Travel" is a little misleading.

Granted this story from the EU is a little, no a lot, wacky - but in reality, we pay very few taxes to fly.

If I take a train, I pay VAT in most countries, taxis are certainly VAT-able, and when I put fuel in my car I pay excise duty, and VAT (or it's other equivalents in EU states) on top.

What do I pay in tax when I fly? Well the British government charges Air Passenger Duty - I don't believe this is the norm around the rest of Europe, but I may be wrong. Everything else masquerading as "taxes" are generally airline, or airport imposed costs, which in the case of lo-cost carriers are shunted into this heading to make the headline fare look more attractive.

Myself, as a passenger who understand the damage to the planet that flying actually does, I would not be too averse to some level of VAT on the air fare itself, or perhaps an environmental tax. As for the 3rd world tax - just forget it!

[MarkD]

Are there "Fast track" security lanes in LGW if you are in First/biz? Plus there's the lounges.

Let's face it, it's one of those things airports get away with because the vast majority of the people paying for first/biz don't notice it.

[WHBM]

Anyone who thinks that this "aid" money gathered by such a tax would be actually be spent on real assistance rather than in supporting a range of politically correct issues along the way is living in cloud-cuckoo land.