Aviation Sector Responds Strongly to French Airport Tax Proposal

The French government recently unveiled plans to introduce a proposed 'eco levy' on the transportation sector in 2024.

This is a move that is poised to impact the country's major airports and potentially escalate travel expenses.

As part of its 2024 budget proposals, the government is advocating for a 4.6 percent tax to be levied on airports with annual operational revenues surpassing €120 million. This tax will have repercussions for prominent transportation hubs like Paris Charles de Gaulle Airport (CDG) and Paris Orly Airport.

Groupe ADP, the entity responsible for managing both Paris CDG and Orly, has articulated its intention to pass approximately 75 percent of the tax burden onto airlines, gradually increasing fares over a span of two to three years, commencing with the first hike on April 1, 2024.

Anne Rigail, the CEO of Air France, voiced her concerns about this development during a recent radio interview, asserting that the tax is “not at all good news” and also risks “hurting French airlines.” She highlighted that several of the carrier's low-cost competitors operate out of smaller regional airports.

The French government anticipates an annual revenue generation of approximately €600 million from this tax. This levy will also impact other airports like Nice, Marseille, Lyon, and Toulouse, according to ACI Europe, an association representing airports.

ACI Europe has additionally implored the French government to reconsider its strategy, emphasizing that the proposed tax could hinder airports' “ambitious decarbonisation plans” and adversely affect “their competitive position and their connectivity.”

Olivier Jankovec, the Director General of ACI Europe, expressed:

“Squeezing airports that are leading decarbonisation efforts for tax revenue is ill-advised and amounts to policy greenwashing.

“Achieving net zero for European aviation will require more than €820 billion in investments across the entire ecosystem comprising aircraft manufacturers, airlines, airports and air navigation service providers. Further taxing the sector will only make such investments more difficult and threatens our shared goals,”

This proposed tax initiative follows the French government's recent prohibition on certain domestic flights, part of the nation's commitment to achieving carbon neutrality by 2050.

 

Source: businesstravelnewseurope.com