Germany to Cut Air Traffic Tax in July to Strengthen Aviation Industry
Key Details of Germany's Air Traffic Tax Reduction
Background and Decision
BERLIN, May 22 (Reuters) - Germany decided late on Thursday to reduce air traffic tax from July, down to May 2024 levels, in an attempt to boost the aviation sector.
International airlines have long complained that flying to and from German airports was too expensive and threatened to reduce their presence there
Government Action
• German Chancellor Friedrich Merz's cabinet in April approved plans to reduce air traffic tax from July, down to May 2024 levels, in an attempt to boost the aviation sector.
Coalition Agreement
• The move fulfils a pledge in the coalition deal between Merz's conservatives and Social Democrats to reverse a 2024 tax increase made by previous government
Tax Structure and Impact
Details of the Tax
• The duty is imposed on airlines at German airports, on top of airport charges and fees
Reduction Amounts
• The tax will be reduced by €2.50 ($2.91) per ticket for short-haul flights, €6.33 for medium-haul, €11.40 for long-haul
Implementation Date
• Takes effect from July 1
Financial Impact
• Cost to federal government will be around 170 million euros for second half of this year and 355 million euros in subsequent years
Exchange Rate
($1 = 0.8604 euros)
Article Credits
(Writing by Ludwig Burger, editing by Kirsti Knolle)
