KLM is protesting the new Dutch transit tax

KLM Royal Dutch Airlines, the flag carrier airline of the Netherlands, has voiced its opposition to a new tax proposal targeting transit passengers in the country. The motion, passed by the Dutch parliament on September 21, 2023, proposes to tax airline passengers transiting through Amsterdam Schiphol Airport (AMS).


The Tax Proposal

The proposed tax could add around €50 per ticket, a move that KLM fears will greatly affect its current business model. According to Marjan Rintel, KLM’s CEO, transit passengers account for around sixty percent of its traffic. A report by consultancy and research firm CE Delft estimated the number of transit passengers could drop by more than a third if the proposed tax goes ahead.

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Impact on KLM and the Dutch Economy

In her message, Rintel highlighted the role of KLM in ensuring the country’s air connectivity and its role in the Dutch economy. She expressed concern about the new taxes, including other levies that will go into effect in January 2024, placing the airline at a disadvantage in front of its competitors. She also expressed her view that the new tax, whose proceeds will allegedly be used to alleviate the energy costs of Dutch residents, will not benefit the environment.

The Bigger Picture

This tax proposal is not an isolated incident. Earlier in 2023, for example, the Dutch government announced its plans to restrict and reduce the number of operations at Schiphol to mitigate the noise impact in the surrounding areas during nighttime. These regulatory and taxation initiatives have targeted the commercial aviation industry in The Netherlands.

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Looking Ahead

The proposal now approved by Dutch MPs was proposed by the CDA, one of the political parties in the coalition that supported Mark Rutte’s government, which collapsed in July 2023 following disagreements between its members over migration policies. A general election is planned for November 22, 2023. As we await further developments on this issue, it's clear that KLM and other airlines operating in The Netherlands are facing significant challenges. The impact of these proposed changes on KLM's operations and on Dutch connectivity remains to be seen.

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