The 18th district of Budapest would like to introduce a new tax on plane tickets concerning all passengers departing from Budapest’s Liszt Ferenc International Airport. As a result, plane tickets may become more expensive for tourists and Hungarians alike. The introduction date, according to the plans, is 1 January 2023. But there may be obstacles.
According to Világgazdaság, the local government of the 18th district, where the Budapest Airport is, would like to introduce a new tax concerning all passengers (except those below 18 and those who live in the district) with a so-called passenger tax. They say the reason behind their plan is soaring inflation. Furthermore, they said that the district’s residents are exposed to the noise and environmental pollution the airport generates.
Péter Kőrös, one of the deputy mayors of the district, said they conducted negotiations with Hungary’s finance ministry, and they did not object. However, the Ministry did not confirm that statement to Világgazdaság.
The deputy mayor added there would be no double taxation in the case of the new tax. That is because the government’s departure tax applies to airlines. Meanwhile, their passenger tax would concern private individuals.
In the first draft of the proposal, the tax collector would have been the company carrying out ground service. At the local council’s session, the district’s leadership said that was because the new system would be similar to the tourism tax (in Hungarian: idegenforgalmi adó), in which case guests pay for the accommodation provider.
The initiative is brand new in Hungary. Therefore, even local government officials doubt it would pass without opposition or legal obstacles. Meanwhile, deputy mayor Péter Kőrös was proud of their innovation during the last session of the local council, highlighting they would be icebreakers in an undiscovered terrain.
The deputy mayor wrote about the initiative that they held discussions with the representatives of the ground handling service providers. Considering their remarks, the second draft of the proposal included airlines in the tax collection process because they meet the passengers first. The document defines joint liability concerning passengers, airlines, and ground handling providers.
Miklós Pálffy, a cooperating partner of the Niveus Consulting Group, said introducing such a new tax is not problematic from 1 January. However, an anonymous expert of Világgazdaság asked, added it will be impossible to check all passengers’ address card at the airport. And that would be inevitable if the residents of the 18th district remained exempted from paying the new tax.