Martin Mansergh (Tipperary South, Fianna Fail)

I am pleased to take this opportunity to clarify matters relating to the introduction of an air travel tax that the Minister for Finance announced in the budget, which will come into force for passengers departing Irish airports on and from 30 March 2009. The Minister for Finance has answered parliamentary questions on this issue as recently as today.

As has been stated previously, the general rate it is proposed to apply will be €10 per passenger, with a lower rate of €2 for shorter air journeys, that is, those not in excess of 300 kilometres. The Minister decided that a relatively short air journey should attract a lower charge. It is not unusual for the price of fares for longer journeys to be higher than those for shorter journeys and the tax reflects that position. The Minister was also conscious that the tax would apply to both the outward and return journey in respect of domestic flights. In addition, the Minister was cognisant of the greater competition that exists from other forms of travel for that sector, relative to longer flights.

Ireland is not unique in applying a tax on air travel. Many countries within the EU and worldwide apply similar taxes. For example, our nearest neighbour, the UK, has applied a similar tax for over 20 years. The UK applies an air passenger duty of £10 or €12.65 for a standard ticket for any destination in the UK or Europe. For all other destinations the rate is £20 or €25.30. Both these rates double for tickets other than economy class. A new Dutch aviation tax entered into force in July this year. The tax is charged at €11.50 for EU destinations and €45 for other destinations. In France civil aviation tax is charged at approximately €4 for EU destinations and €7 for other destinations. The Belgian Government recently announced its intention to introduce an air travel tax, however the details are not yet available. Further afield, Australia and New Zealand, which like Ireland are very dependent on air travel, also apply departure taxes. The proposed rates for the Irish air travel tax are not unreasonable both for shorter and longer journeys, when compared to rates in other countries.

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