Joanna Tuffy (Dublin Mid West, Labour)
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Question 172: To ask the Minister for Finance the amount of tax revenue raised to date in 2009 from the €10 air travel tax; the impact this has had on air travel to and from here; if he will carry out a comprehensive review of the implementation of this tax; if he will make amendments to this tax in budget 2010; and if he will make a statement on the matter. [37695/09]

Brian Lenihan Jnr (Dublin West, Fianna Fail)
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I am informed by the Revenue Commissioners that the air travel tax arising from travel undertaken in any month is payable by airline operators by the 23rd of the following month. The yields from the air travel tax received in the period from May to October 2009, in respect of travel undertaken during the months April to September 2009 are as follows:

As the Deputy is aware, I announced in Budget 2009 that an air travel tax would come into force in respect of passengers departing from Irish airports on and from 30 March 2009. A general rate of €10 per passenger would apply, with a lower rate of €2 for shorter journeys.

The Finance (No.2) Act 2008 confirmed the introduction of an air travel tax from 30 March 2009. However, I took account of concerns raised by the regional airports particularly those on the western seaboard. The lower rate of €2 applies to departures from any Irish airport where the destination is 300kms or less from Dublin airport. This means that all Irish departures to locations such as Manchester, Liverpool and Glasgow are subject to the €2 rate.

Ireland is not unique in regard to applying a tax on air travel. Other countries within the EU apply similar taxes such as the UK and France, as do Australia and New Zealand. The rates for the Irish air travel tax are not unreasonable both for shorter and longer journeys, when compared to rates in other countries.

It should be recognised that tourists are only subject to the tax on their return journey. The additional €10 or €2 in the context of a much larger purchasing decision involving travel, hotel expenditures etc. should have only a very limited effect on tourist numbers. The Government appreciates the airline industry continues to go through a difficult period. However, this difficult trading period arises primarily from weak world economic activity.

It should be noted that at present the decline in air travel is an international phenomenon and as a result aviation services are contracting on a global basis. Indeed the decline in the number of people travelling is also evident in those countries where there is no air travel tax in place.

We currently face significant financial challenges and the air travel tax is an important revenue raising measure. The Government has tried to be as fair as possible in looking at areas for additional tax revenues. It is also worth noting that fuel used by commercial airlines is completely exempt from tax, so it's a sector that already has considerable preferential treatment.