Minister Nagy Should Scrap His Dishonest ‘Excess Profits’ Tax

Ryanair, Hungary’s No.1 airline, today (20 June) called on Minister of Economic Development, Márton Nagy, to apologise to Hungarian visitors and families for misleading them with false claims about his ‘excess profits’ tax, which will penalise Hungarian visitors and families from 1 July next.

On Saturday last, Minister Nagy made the following false claims:

1. He falsely claimed that Ryanair is ‘Europe’s most profitable airline’, despite Ryanair having recently announced 2 years of record losses.
   
   
2. Minister Nagy falsely claimed that his new ‘excess profits’ tax is paid without any problems in other European counties. No other European country applies an ‘excess profits’ tax on a loss-making industry like airlines.
   
   
3. Minister Nagy then misled Hungarian families when he falsely claimed that ‘no one passes on the extra profits special taxes to the population’. As Minister Nagy well knows, under EU law, EU Reg 1008/2008 all airlines are free to set airfares for intra-EU air services as they so choose, without any interference from national Govt.’s or their ‘consumer protection agencies’ (see attached EU Reg 1008/2008).
   
   
4. Ryanair will be passing on Minister Nagy’s idiotic ‘excess profits’ tax to all passengers travelling on its flights to/from Hungary after 1 July. For passengers who had made bookings to travel after 1 July, prior to the imposition of this idiotic ‘excess profits’ tax, those passengers have been offered the opportunity to cancel their flights and receive full refunds. Less than 3% of Ryanair’s passengers have chosen to cancel, and the remaining 97% will be required to pay Minister Nagy’s idiotic ‘excess profits’ tax (imposed on airlines who are making records losses) if they wish to fly after 1 July next.

Ryanair’s Michael O’Leary said:

“We remain surprised that at Minister Márton Nagy continues to make false claims and misleading statements to Hungarian families and visitors. At a time when European airlines have made record losses, there is clearly no basis for his ‘excess profits’ tax. His claim that other EU airlines charge an ‘excess profits’ tax on air travel is also false.

Minister Nagy should be under no doubt that European airlines are free to set airfares as they so choose under EU law, and if he chooses to impose extra taxes on or after 1 July, then these taxes must be paid by Hungarian families and visitors who fly after that date.

Minister Nagy should now apologise for introducing an idiotic “excess profits” tax on a loss-making industry, and he should also apologise for misleading Hungarian families and visitors who will have to pay this tax if they wish to fly to/from Hungary from 1 July next. Better still, instead of apologising, Minister Nagy should scrap this idiotic tax which has no place in a loss-making industry like airlines, who have suffered 2 years of devastating losses thanks to Covid-19, and the Russian invasion of Ukraine.”

EU Regulation 1008/2008