Widerøe threatens to slash 37 routes due to VAT
The airline Widerøe announces that they will discontinue nearly 40 domestic routes If the Norwegian government imposes a common VAT of 23 or 25 per cent, Nationen writes.
The threatened slash constitutes the majority of the airline’s commercial flights in Norway.
The Ministry of Finance has previously stated that they want a fixed common VAT of 23 or 25 per cent. Something which will increase the fees on, among most other things, passenger transport, accommodation and food.
The proposal has been submitted for consultation. In Widerøe’s consultation response, the airline announces that such an increase will lead to a comprehensive cut in its domestic routes.
“Increased VAT from today’s 12 per cent to 23-25 may entail more than NOK 100 million in lost revenue. This due to loss of passengers,” Director of Strategy and Infrastructure of Widerøe, Terje Skram, tells Nationen.
Air travel and CO2 fees
The airline further argues that both air travel and CO2 tax already mean that several of Widerøe’s flights are not profitable. This has already affected routes that are part of the «public transport» in the districts, through increased prices and reduced offer.
They ask the Norwegian government to look to Sweden and Denmark instead. These countries have 6 per cent and zero VAT on passenger transport, respectively.
The consultation deadline for the proposal for a common VAT charge expires August 29th. Minister of Finance, Siv Jensen (Progress Party), has previously stated that she believes that it will be inappropriate to increase any VAT percentage.
© NTB Scanpix / #Norway Today