THE Government’s €10 travel tax, which is a crunch issue in the threatened halving of Ryanair flights from Shannon, has come under discussion between the Department of Finance and Ryanair boss, Michael O’Leary. THE Government’s €10 travel tax, which is a crunch issue in the threatened halving of Ryanair flights from Shannon, has come under discussion between the Department of Finance and Ryanair boss, Michael O’Leary.
However, Finance Minister Brian Lenihan is staying quiet about whether the levy will be removed in the upcoming Budget.
Removal of the travel tax was one of the Ryanair demands which Shannon Airport director Martin Moroney said was not within the power of the Shannon Airport Authority to deliver when the breakdown in negotiations on a new Ryanair deal was followed by the Michael O’Leary announcement that the airline would withdraw 75% of its Shannon services in April 2010.
While calls from Opposition parties for the removal of the travel tax have been supported by tourism interests and most recently the in-depth Peter Bacon report for the Irish Hotel Federation, disclosure of the Department of Finance discussions with Ryanair only came into the open in the past week.
It took questioning of three ministers before Clare Fine Gael TD Pat Breen could ferret out that the travel tax did come under discussion.
In his contribution to Dáil debate on a Private Members Bill on transport last week, Deputy Breen reported that when he had raised questions about the travel tax, the Minister for Transport, Noel Dempsey, had stated that he had no statutory function in that regard.
But the Clare TD pointed out that this did not square with the statement made just days before by Tánaiste and Minister for ­Employment, Trade and Enterprise, Mary Coughlan at the Shannon Development seminar in Limerick. The Tánaiste said then that talks between the Government and Ryanair were “ongoing”.
Now, confirmation that the travel tax did come under discussion has come from the Minister for Finance, whose department is responsible for the tax on travellers.
In response to a series of Dáil questions from Deputy Breen, Minister Lenihan stated that “a meting took place with Ryanair to discuss a range of issues and the air travel tax arose in that context”.
However, the Finance Minister was not going into detail, only stating “it is policy to review all taxes in the lead-up to the Budget. However, there is no specific review of the air travel tax”.
Deputy Breen took advantage of the Dáil debate on transport policy to reiterate his call on the Minister for Transport to include people of expertise when the making nominations to the Shannon Airport Authority.
“When the minister eventually gets around to selecting his nominees, I hope he will give the nod to people from the region with vast experience in aviation, tourism and marketing, rather than doling out jobs for the boys once more,” Deputy Breen told the Dáil.
As the Clare deputy pointed out, Shannon is without a new authority due to the dispute over worker representation since Minister Dempsey handed down a direction that worker director numbers were to be halved from four to two.
The SIPTU trade union, which elected three representatives to the board that went out of office in mid-September, has been backed by the Irish Congress of Trade Unions in resisting the change. Consequently, the make-up of the new Shannon Authority has been left up in the air while the issue of worker representation is thrashed out in the ongoing pre-Budget talks between the social partners.

€10 air charge will cost Shannon many services

Owen Ryan

THE €10 air travel tax is the major issue that is set to cost Shannon most of its Ryanair services, Deputy Pat Breen has claimed, after a meeting with Michael O’Leary.
Deputy Breen said that the Ryanair chief had stressed the seriousness of the issue to him. “I had a meeting with Michael O’Leary last Thursday night in Dublin. We spoke for 90 minutes and we discussed the €10 travel tax and the fact that agreement hasn’t been reached with the Shannon Airport Authority. I raised my concerns because I feel that Ryanair is integral to the region.
“He’s quite serious about reducing services and will probably do it from Dublin too. He said that the travel tax is a disaster because Ireland is an island and that the only reason they have one in the UK is because London is an international hub, which can’t be compared to Ireland. In Holland and other countries they’ve cut this kind of tax and it’s had a huge impact,” said Deputy Breen.
The Fine Gael TD said Mr O’Leary told him that the airline is still growing abroad. “There’s no doubt that passenger figures are down and it’s having a huge impact. He (O’Leary) blames the Minister for Finance and he feels it’s a ludicrous tax. Ryanair are still continuing to grow abroad.”
Mr O’Leary warned that very serious cuts are to be introduced in Shannon and Deputy Breen said the Government is at fault. “Most of the blame must go to the minister. Ireland needs the aviation sector. Shannon needs Ryanair and Ryanair likes Shannon but this tax is set to see a major loss of services.”
Deputy Joe Carey has urged Tánaiste Mary Coughlan to remove the €10 air travel tax.
Speaking in the Dáil he said, “The €10 travel tax was introduced in last year’s Finance Act. Can the Tánaiste clarify a statement she made in Limerick last week that the tax would be renegotiated and that discussions to that effect would take place with Ryanair? This measure could kill Shannon Airport and the Shannon region.”
He made the comments during a parliamentary debate but the Tánaiste didn’t speak on the matter at the time.