ANNOUNCEMENT 09 May 2009

In May 2009, the government of Ireland announced a targeted tax change.

NUMBER OF INTERVENTIONS

1

  • 1 harmful
  • 0 neutral
  • 0 liberalising

SOURCE



Official Source, state aid case SA.29064
http://ec.europa.eu/competition/state_aid/cases/241380/241380_1411542_95_2.pdf

List of Airlines flying from/to Ireland Airports:
http://www.irishairports.com


Inception date: 09 May 2009 | Removal date: 09 Mar 2011
Still in force

Tax or social insurance relief

 
On 9 May 2009, Ireland introduced a taxation schemefor air passengers. The scheme introduces an air travel tax on thedeparture of passengers from an airport situated inIreland. The scheme distinguishes between two categories: short distanceflights: within 300 km (2 EUR p.p.) and long distance flights: more than300 km (10 EUR p.p.)
 
This distinction is subject to apotential trade distortion because it favors airlines that focus onshort distance flights. The European Commission states that 'the measureis selective and not justified by the nature and the logic of thesystem' (par. 50 , letter from the EC to Ireland, Brussels 25 July 2012).
 
Furthermore, the EC argues ' that thelower tax rate provided an advantage to airline operators serving theroutes to which that rate applied... The Commission notes that the flightsto which the lower rate applied were mainly operated by airlineoperators with a strong connection with Ireland (Aer Lingus, Aer Arannand Ryanair were set up in Ireland and still have their headquartersthere). Therefore, de facto the reduced rate provided an advantage toIrish airline operators compared to other Union operators (par.54, letter from the EC to Ireland, Brussels 25 July 2012).
 
Finally, the EC concludes that 'thereduced rate was therefore capable of affecting trade between MemberStates since it strengthened the position of some airline operatorscompeting in a market which is fully liberalised at Union level (par.61, letter from the EC to Ireland, Brussels 25 July 2012).
 
The scheme was adjusted on 1 march 2011,a single rate of 3 EUR is applicable to all departures, regardless of thedistance travelled.
 
A state measure in the GTA database isassessed solely in terms of the extent to which its implementationaffects the extent of discrimination against foreign commercialinterests. On this metric, the state aid proposed here is discriminatory

AFFECTED SECTORS

 
N/A

AFFECTED PRODUCTS

 
N/A