The Philippines has been urged to drop aviation taxes by the International Air Transport Association (IATA) – a move that could boost air cargo volumes significantly. IATA has recently commissioned a study by Oxford Economics detailing the benefits of aviation to national economies which identified the problem of excessive taxes in the Philippines.
“The removal of taxes could create “win-win” opportunities by boosting economic growth through promoting air transport,” said IATA.
IATA’s view is eliminating both the Common Carrier Tax (CCT) and the Gross Philippine Billings (GPB) would lower the total cost of international passenger travel in the Philippine market by 2.5 per cent.
This is in turn would increase the number of international flights by 1.9 per cent, bringing extra cargo capacity into the market. “Lower cargo transport costs could give a boost to export earnings in the order of US$1 billion,” said IATA.