Taxes imposed on airlines and their customers have a detrimental effect to the benefits that the airlines bring to the consumer and consequently to the economy as a whole. Nonetheless, we see that several states do not yet see the adverse effect that the increase in taxes has on their economy. Taxes are imposed on the sale and use of air transportation, fuel, property, equipment, sometimes income, development aid, environment and climate change, and tourism expansion.
Although most Arab governments look at aviation as a driver to the economy, we still see some hikes in government taxes.
Work with ACAC and IATA
AACO has always been keen on promoting an environment with reduced taxes on airlines, especially when it comes to taxes introduced by governments to fund projects not related to the aviation industry.
AACO cooperates with ACAC and IATA when it comes to advocating for a lower taxes environment. The three associations have published a joint declaration related to taxes as well as airport charges that has instituted their joint work in this area. Please click here to view the joint declaration.
Based on a resolution by the Council of Arab Transport Ministers, AACO works with Arab financial authorities under the umbrella of the Arab League of States to revise the existing Tunis Convention 1979 on the ‘Reciprocal Exemption from Taxes and Charges on Activities and Equipment of Arab Air Transport Institutions’.
Three meetings have been held for the Arab financial authorities with the participation of AACO to revise the existing Tunis Convention and replace it with a new convention that meets the changes in air transport industry since 1979.
To view the report of the first meeting, please click here.
To view the report of the second meeting, please click here.
To view the report of the third meeting, please click here.
To view the report of the fourth meeting, please click here.
To view the report of the fifth meeting, please click here
To check the Tunis Convention of 1979, please click here
To view the resolution of the Council of Arab Transport Ministers on Tunis Convention, please click here.