Ryanair (FR, Dublin International) Chief Commercial Officer David O’Brien says the Irish LCC will wrap up its Greek summer 2016 schedule two months earlier than planned on account of the Greek government's decision to increase taxation on the country's tourism sector. Cancellations will start off with Kos Hippocrates whose tourist inflows have been heavily affected by the influx of migrants from Turkey.
Speaking to the To Vima newspaper, O'Brien said that since 2014, the LCC has submitted proposals to Alexis Tsipras's far-left government to increase the number of inbound tourists to Greece by 5 million per annum.
“We have sent 25 letters over the last two years and have received only three answers, but in all of them there is no response, positive or negative, to our proposals," he said.
Ryanair said it had proposed reducing fees and taxes during the low-season while exempting smaller airfields from the Airport Development levy in addition to slashing it by 50% at Athens Airport. With these incentives in place for a five-year period, Ryanair claimed it could bring in a total of 5.5 million additional tourists.
But, given Greece's unwillingness to cooperate, O'Brien singled out Deputy Tourism Minister Elena Kountoura for criticism in particular claiming that in one letter, she had said she could not make a decision on Ryanair's proposal as it was “not within her competence”. He also claimed she had failed to devise any serious plans of her own to increase tourism in Greece.
Kountoura subsequently justified her comments stating that only the Ministry of Finance and that of Transport had the capacity to propose and alter taxation within the country.
For its part, the bankrupt Greek government is looking to tax revenue from the tourist sector to plug a EUR5.4 billion (USD6.14 billion) fiscal hole. Given the added cost as well as increased VAT taxes already in place, local hospitality and airline sector companies have warned that the move will simply render Greece a less attractive destination to potential holidaymakers.
