Airlines rebel against new EU and Spanish taxes and warn of more expensive tickets

• The ALA employer warns that environmental measures and new taxes will cause Spain to lose 11 million tourists, 12,200 million in tourism revenues, 1.6 points of GDP and 430,000 jobs in 2030
• The president of the CEOE commands an event in Madrid with Iberia, Air Europa, Air Nostrum, easyJet and the global employer IATA to ask for an ecological transition that does not put the airline sector at risk

The big players in the Spanish airline sector are making a common front to curb the impact they say the new package of environmental measures prepared by the European Union and the new taxes proposed by both Brussels and the Spanish Government specific to the airline industry will have on their business.

In a ceremony chaired in Madrid by Antonio Garamendi, president of the CEOE, and with the support of the top executives of the main airlines operating in the Spanish market (Iberia, Air Europa, Air Nostrum, easyJet, Iberia Express …) and the international employer IATA, the industry has warned of the multiple socioeconomic blows that, According to their estimates, they will have on the sector and on the whole of the Spanish economy. An impact, in addition, that would be much greater in Spain than in other EU countries due to the enormous weight of tourism in the national GDP (around 12.5% of the total).

The European Union’s plan to promote decarbonization Fit for 55, with the aim of reducing CO2 emissions by 55% by 2030, includes environmental measures for the aviation sector such as a tightening of emissions trading or increasing the percentage of sustainable fuels used by aircraft. The European Union is also working on the Twenty-seven applying a new tax on kerosene and, in addition, the Spanish Government is considering applying a specific rate to air tickets as part of green taxation (the Treasury activated its study, but the application was frozen due to the pandemic).

The Association of Airlines (ALA), which brings together sixty airlines operating at Spanish airports, stresses that community environmental measures will mean an extra cost for the air sector, but admits that they will serve to move towards the decarbonization of the area industry. However, the airline employers complain that the new taxes prepared by the EU and the Spanish Government will only serve to make air tickets more expensive and lose customers, and that they are not effective for the objective of moving towards the reduction of emissions.

LESS TOURISM, LESS EMPLOYMENT

ALA and the main companies in the sector warned of the impact on their business, throughout the tourism sector and for the Spanish economy as a whole. A report by the consulting firm Deloitte, commissioned by the airline employers themselves, includes specific estimates of the multiple socioeconomic blows that the package of measures of the Fit for 55 and the application of the tax on air tickets of the Spanish Government would represent.

According to Deloitte’s study Flying towards a sustainable future, applying all the measures would cause Spain to lose a total of 11 million international tourists by 2030; reduce tourism revenues – what foreign travelers actually spend in the country – by 12.2 billion euros; cut Spanish GDP by 1.6 percentage points (the equivalent of €23.4 billion); and destroy 430,000 jobs by the end of the decade.

From ALA and Deloitte it is pointed out that most of this economic impact is due to the eventual application of the new taxes. According to their estimates, fiscal measures would concentrate 0.9% of the fall in Spanish GDP and the loss of 236,000 jobs in the national economy as a whole, compared to the 0.7% cut in GDP and the 194,000 jobs lost by environmental measures.

“TAX COLLECTION”

“From the sector we agree with the environmental measures that contribute to achieving the objective [de emisiones netas cero en 2050], and we are willing to assume an extra cost to the extent that they contribute to the decarbonization of the sector. However, the fiscal measures respond to a collection effort and do not decarbonize, generating an important impact on the tourism sector, “said Javier Gándara, president of ALA and chief executive of easyJet in the Spanish market.

“We ask for prudence and not to implement new fiscal measures and taxes that can be an important drag on the competitiveness of the air sector,” claimed the president of CEOE, Antonio Garamendi, “sustainability cannot be at any price, we need an orderly ecological transition with realistic milestones, with intelligence and without making our companies lose competitiveness. ”

Iberia has warned that the application of the new taxation will lead to an increase in the price of air tickets, with the consequent blow to demand. “In recent decades the airline sector has managed to democratize tourism. But these measures are going to put an end to this democratization. Only the elites will be able to travel, the same ones who traveled in the eighties, “said Juan Cierco, Corporate Director of Iberia.

Source: EPE