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Higher aviation taxes ‘a counterweight to prosperity’, Iata chief warns

Heightened taxes and onerous regulation on aviation have been described as a “counterweight to prosperity”.

The call from Iata director general Willie Walsh came just hours before Chancellor Jeremy Hunt announced a rise in non-economy Air Passenger Duty in Wednesday’s spring Budget, triggering an industry backlash.

Walsh urged governments to see the aviation sector as a “catalyst for growth”.

The former boss of British Airways and International Airlines Group was commenting as the airline trade body released data for January global passenger demand, indicating a strong start for the year.

Total demand was up by 16.6% year-on-year, outstripping the 14.1% rise in capacity with the industry load factor increasing by 1.7 percentage points to 79.9%.

Demand for international flights rose by 20.8% and 10.4% for domestic air travel around the globe. 

The International growth was driven by a 45.4% increase in January traffic seen by airlines in the Asia-Pacific region, continuing a rapid recovery after the lifting of pandemic restrictions. 

The “exceptionally strong” growth rate was largely attributable to China which was in the early stages of lifting Covid-19 travel restrictions in January 2023. 

“The recovery in major international routes to/from Asia-Pacific is still lagging, but routes such as Asia-Middle East have exceeded pre-pandemic levels,:” Iata said.

Meanwhile, routes between Europe and North America have rebounded “particularly strongly” from the pandemic and stand 6.5% higher than in January 2020.

Walsh said: “2024 is off to a strong start despite economic and geopolitical uncertainties. 

“As governments look to build prosperity in their economies in the busiest election-year ever, it is critical that they see aviation as a catalyst for growth. 

“Increased taxes and onerous regulation are a counterweight to prosperity. 

“We will be looking to governments for policies that help aviation to reduce costs, improve efficiency and make progress towards net zero CO2 emissions by 2050.”

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