June 6: India on Monday was put on the ‘Wall of Shame’ by the IATA for imposing high service tax on air tickets when aviation sector was growing, with the world airlines’ body warning the country not to kill the “goose that lays golden eggs”. The Indian government was put on the ‘Wall of Shame’ at the Annual General Meeting of the International Air Transport Association (IATA), along with the European Union Parliament and the governments of the UK, Germany and Austria, for imposing high taxes on air travel.
Asserting that aviation fuelled global trade stimulated economies and restored government budgets, IATA’s director general and CEO, Mr Giovanni Bisignani said “don’t kill the goose that lays golden eggs. Tax the bankers who created the mess. Their billions of dollars in bonuses should help clean it up. Asking the UK, German, Austrian and Indian governments to “stop compromising economic growth with aviation taxes,” he said these governments. “Taxing aviation does not pay. The Dutch government repealed a $412 million departure tax because it cost the Dutch economy $1.6 billion.
Similarly, the Irish government is planning to cancel its $165 million travel tax because it has cost the economy $494 million and 3,000 jobs,” he said. Charging EU Parliament with “ignoring international law” and deciding to impose carbon emission trading scheme to charge airlines, the IATA chief said “also on the Wall is the hit parade of government tax bandits.”
While the UK has imposed “the highest aviation tax in the world” with $4.5 billion, Germany has imposed a $1.3 billion departure tax followed by Austria’s $119 million tax and “India for the $450 million impact on aviation of its service tax in complete contravention of ICAO rules.”