25 Feb 2020

New Zealand airport taxes too high - airlines

7:01 pm on 25 February 2020

A group of airlines may stop flying to New Zealand because government charges are making the cost too high, they say.

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Qantas has cancelled some trans-Tasman flights because of the Covid-19 coronavirus. Photo: 123RF

The Board of Airline Representatives (BARNZ), which represents more than 30 domestic and foreign airlines and related servicing companies, said for a trans-Tasman flight airport charges; taxes, levies, and air traffic control costs now make up more than half the cost of the ticket.

BARNZ executive director Justin Tighe-Umbers said the coronavirus was adding further pressure to the economics of flying here.

"Even before Covid-19 hit, New Zealand was running a risk of airlines relocating to more profitable routes."

He said over the past 10 years border agency costs had nearly doubled and airport charges risen 16 percent.

"BARNZ members believe these increasing border costs for airlines and passengers are not sustainable in the long term," Tighe-Umbers said.

He said the fall in airline profitability was causing them to consolidate their routes, and in some countries such as Singapore governments were giving assistance to their aviation sectors.

"New Zealand could look at extending its help to aviation too. This country needs to ensure it remains a profitable route for airlines."

The NZ Airports Association agreed and said the charges were "headwinds the country could do without".

Chief executive Kevin Ward said it had regularly been pointed out to government, that escalating charges and taxes made New Zealand less competitive as a destination.

"During periods of good growth it has been easy for agencies to regard tourists as an easy source of revenue for their border services. We agree with airlines and tourism businesses that recent increases in levies and taxes are a headwind the country could do without when conditions get more difficult - like now."

Ward said international airports in New Zealand had not increased per passenger charges for years.

"Christchurch and Auckland Airports will not be re-looking at their charges until 2023, and Wellington Airport is consulting on prices now."

The government has announced an $11m package to help the tourism industry counter the virus's impact.

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