(Bloomberg) -- The new French government plans to raises taxes will be “disastrous” for the country’s economy and its aviation industry, said Willie Walsh, director general of the International Air Transport Association.
The French government may significantly increase taxes on air passengers as part of a general package of new taxes aimed at closing France’s budget deficit, Walsh said in a statement.
“If these tax proposals are implemented, it will be a disaster for France,” he said. “Aviation is a driver of employment and prosperity, as well as a proven accelerator of growth in other parts of the economy.”
The French government on Wednesday announced plans of around €60 billion ($66 billion) in spending cuts and tax hikes next year in an effort to rein in a widening budget deficit and bolster investor confidence in the country.
Walsh said any new taxes will hurt the tourism industry and the aviation sector in France, which has fewer passengers and serves fewer destinations than it did before the pandemic. The measures may also cut into the massive funding needed for the transition to sustainable aviation fuels, he said.
Walsh gave the example of Sweden, which responded to their sluggish growth by announcing plans to abolish their aviation tax.
“The only answer for France’s deficit is to grow its economy and widen the tax base, not tax the productive parts of the economy to a standstill,” he said.
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