Dáil Éireann Debate, Tuesday - 2 December 2014
213. Deputy Michael McGrath asked the Minister for Finance the implications for Ireland of the European Court of Justice ruling in respect of the levying of air travel tax on transit and transfer passengers; if he has estimated a potential cost to the State; and if he will make a statement on the matter. [46173/14]
View answerThe General Court of the EU has struck down the Commission's decision that the exemption of transfer and transit passengers from the Air Travel Tax did not constitute State aid. This judgement was made on the basis that the Commission's decision was not based on a full and formal investigation.
The Deputy is aware that Ryanair lodged a State aid complaint with the Commission against the Air Travel Tax in 2009 and that subsequently, in July 2011, the Commission found that the use of a lower rate of tax for flights within 300 km of Dublin airport seemed to constitute State Aid. The Commission dismissed Ryanair's claim that the non-application of the Air Travel Tax to transit and transfer passengers constituted a State Aid.
Ryanair appealed the Commission's findings, both in respect of the State Aid decision and the exemption for transit passengers, to the General Court in September 2011. As already outlined, the General Court has now struck down the Commission's decision that the exemption of transfer and transit passengers from the Air Travel Tax did not constitute State aid. This judgement does not come to any conclusion as to whether the exemption constituted state aid. Rather, the judgement was made on the basis that the Commission should have but did not initiate a formal investigation procedure in order to gather the necessary information and to allow all parties to present their observations in connection with that procedure.
The Commission may now conduct a formal investigation or appeal the judgment to the Court of Justice of the European Union. The European Commission has been ordered to bear its own costs and Ryanair costs.
