Austrian government to cut local aviation taxes 50% by 2018

The Austrian government will cut local aviation taxes 50% by January 2018. Pending government approval, taxes should be reduced by 25% in 2017 and 25% the following year. The tax, which has become a burden for the industry, was implemented in 2011. Passengers boarding in Austria were charged E7 ($9.60) for short-haul flights, E15 for medium-haul flights and E35 for long-haul flights. “We would welcome such a move [reducing the aviation tax], which we see as a positive sign. Our competitive disadvantage will be then reduced,” Austrian Airlines spokesperson Peter Thier said. In 2015, airlines operating to and from Austria contributed €107 million to Austria’s ministry of treasury. “[Lufthansa Group subsidiary] Austrian Airlines itself delivered E32.5m, about 30% of this aviation tax. The Lufthansa Group paid E50.7m, 47% of the E107m,” Thier said. Reducing the local aviation tax is expected to increase Austria’s competitiveness in Europe and improve tourism business. Vienna Airport stated in an analysis that, without this tax, Austria could generate 1 million additional passengers annually.<br/>