NEWS | Wednesday, 30 April 2008

Ryan Air, Air Malta not worried about competition

Departure tax removal to be “announced shortly”

David Darmanin

In spite of the fact that the impending fixed rate departure tax removal, of €23.29 on each ticket, will translate into a stronger percentage discount for the cheaper airline tickets, neither Air Malta nor Ryan Air are taking into consideration the impact such removal of tax may have on competitiveness.
Approached for comment after his inauguration speech at the Amitex fair last week, Air Malta Chairman Lawrence Zammit said: “I don’t see how either airlines stand to gain or lose, in terms of competitiveness, once the tax is levied.”
Asked whether he considered that on a €230 ticket sold by Air Malta the removal of departure tax would translate into a 10 per cent discount, while on a €100 with Ryan Air, the discount would be of 23 per cent, Zammit said: “The fact that we had an increase in passengers last year not only proves that we can withstand competition but also that we can beat it.”
Contacted at her Ireland office, a spokesperson for Ryan Air said that while the airline “supports the removal of all taxes which keep the cost of air travel artificially high”, the removal of departure tax is not expected to have a bearing on competitiveness as “Air Malta doesn’t compete with our guaranteed lowest fares as it is.”
Earlier this month, EU officials have expressed regret on the fact that, in spite of an electoral promise featured in PN’s manifesto leading to March 8 elections, the Maltese government has delayed the removal of the controversial €23.29 tax on flight tickets. Asked to provide an indication on when the government is expected to remove the tax, Finance Minister Tonio Fenech said: “We will be making an announcement shortly.”
On consequences expected now that the EU complained about the process has being delayed, Fenech curtly said: “The EU has complained, and we’re managing the process accordingly.”

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