Germany is moving closer toward raising taxes on domestic flights in hopes of reducing demand and eventually greenhouse gas pollution. But Lufthansa stands to benefit from the new taxes.
Like other nations, Germany finds itself falling short of the ambitious pledges it made under the 2016 Paris Agreement. Now Christian Democrats and Social Democrats, which represent the governing coalition, are finalizing a plan to as much as double taxes on shorthaul flights.
While the particulars remain under negotiation, the plan was announced this week in Berlin by Andreas Jung, a CDU member representing Freiburg and known as the party’s finance expert.
We want a doubling of the ticket tax for domestic flights which would build on the current regulation. And in the current regulation, feeder flights are exempt. This exemption would be continued.
Did you catch that? A feeder flight is a short flight that connects passengers to a longer flight. Domestic flights connecting to/from longhaul flights will not incur the fee. But this exemption applies to purely domestic travel in Germany as well. For example, a trip from Hamburg to Munich via Frankfurt would be charged the same tax as a nonstop flight, if on a single ticket.
That “exemption” greatly aids Lufthansa, limiting tax exposure and essentially penalizing low-cost-carriers like Ryanair who do not sell “connecting” flights. If you cobbled together a one-stop itinerary on Ryanair, you’d be paying the tax twice.
This fits in with a recent Christian Social Union plan to target Ryanair. It is also why Lufthansa CEO Carsten Spohr has expressed little objection to the new tax.
Currently, domestic flights are taxed €7.40 plus VAT, bringing the total to €8.78. The plan is simply to double it. With the exception of the AFD party, most center-right and left parties are expected to support the new aviation taxes.
CONCLUSION
When Germany first introduced its aviation tax in 2011, Ryanair retreated. Now it is back stronger than ever, but the new tax will significantly increase the price of a Ryanair ticket versus Lufthansa ticket on a comparative basis. Thus, the new tax might not only help Lufthansa on a short-term basis, but force another Ryanair retreat in Germany, which would further raise airfares and entrench Lufthansa as the monopoly carrier.
> Read More: German Politicians Plot To Raise Airline Ticket Prices, Institute Price Floor
image: Lufthansa
This ridiculous tax scheme is a joke. It has absolutely zero to do with any sort of save-the-environment BS. It’s an anti-competitive ruse designed to buy votes. How the government sells this with a straight face is awesome.
+1
Any regulation that hurts Ryanair and helps real airlines is music to my ears.
I’m always amazed how detached some people are from reality.
Normally the call them Morons !!
If you don’t understand what’s going on don’t chime in !!
Translation: They need more tax revenues to support the millions of invading migrants Merkel and the ruling government brought in. In turn, more votes to stay in power.
As one who actually lives in Germany Chris@Oak, the “invading” migrants are the best thing that ever happened. The German population is shrinking and more and more young people are forgoing traditional blue-collar jobs for university. Those migrants have busted their butts to learn German, and have taken the proper steps to earn their certification for those jobs. Hence, it’s why you don’t hear anything about those migrants being a strain on the system any longer. The far-right party AfD has changed their message back to the rise of Islam and not lazy migrants since all the figures from the government and private institutions show it has been a resounding success.
Now, the article was about the plan to double the domestic tax, let’s stay on topic please and leave the xenophobia and misinformation out of it.
They are the best thing for the German-dominated Kleptocracy in the Globalist EU. No wonder Turkish is the second language of the new Reich. Good for you; exploiting cheap labor and building Eurostan.
More flight taxes. Keep them coming.
I think sensible people would rather pay German workers more to do menial jobs and encourage Germans to have more kids than have millions of dangerous migrants who commit a disproportionately high amount of violence and are more likely to rape daughters and turn Germany into another South Africa. Migrants learning German does not change genetics.
Well, you are wrong in this regard. According to the recent publication, the migrants are mostly qualified people and are benefiting the German industries ( who are looking to fill their skill shortage gap). Please do some reading before commenting bullshit..lol. The taxes should be raised on Air travel ,as it is the most polluting way of travel, and the train tickets should get cheaper. We all should make an effort to save environment
Germany’s economy is faltering! Exports are decreasing.
Crime is increasing. The German environment is transforming into the wastelands of Africa and the ME.
More transportation taxes to support Gimmiegrants and Kleptocrats.
Take more trains? Get mugged or sexually assaulted at stations? Many are in no/go zones dominated by gangs.
I took this to mean that your feeder flight for an international trip wouldn’t be subject to the additional tax…..which seems reasonable. For example, on a Hamburg-Munich-SFO ticket, there would be no extra tax on the Hamburg-Munich leg because it is feeding an international flight. This would make sense, as the point is to discourage plane travel for domestic trips and this exception would make sure that international trips are unaffected for those that don’t happen to live in FRA/MUC.
I’m not familiar with the domestic German market, but are there really that many people booking domestic German flights with layovers? I would think at that point it would be more efficient to take the train in nearly all cases anyway.
What you say is true, but so is my point. There is only a single levy, not a per-segment levy. That helps Lufthansa and hurts Ryanair.
Matthew, Putin’s trolls are using your blog as a platform again. See the xenophobic comments above. Time to clean things up.
(Sadly, you can expect more and more of this as the 2020 elections loom and the slimebags slither out from under damp logs.)
Lufthansa is protected by the German government yet again.
One for the European Court I think.
If you want to save the planet, stop driving at 120 mph. I drove that fast and some cars passed me.
On the other hand, it saves time if you can drive 120 mph instead of 55 mph.
If people want to save the planet, don’t ban plastic bags or tax domestic flights heavily but stop driving a truck if you don’t need a truck and stop eating so much. If you have a pot belly, that is a lot of beef and pork chops in your belly