ALTA: tax increase will position AICM as one of the most expensive airports in Latin America and the Caribbean
ALTA expresses its refusal to the imminent tax increase on airport landing, apron, overnight and ERPE services at Mexico City's International Airport.
December 11, 2023
The Latin American and Caribbean Air Transport Association (ALTA), an entity representing 160 companies in the air transport ecosystem, including 40 airlines responsible for over 80% of air traffic in the region, expresses its refusal to the imminent tax increase on airport landing, apron, overnight and ERPE services at Mexico City's International Airport.
The proposed increase, which is approximately 77%, will make the AICM one of the most expensive airports in the region. Landing, take-off and navigation is the second most expensive item in the operating cost structure for Mexican airlines, only after fuel.
In 2022, and during the first 3 quarters of 2023, years of high growth for Mexican air transport, these navigation, landing and landing expenses constituted 14% of operating expenses. With the proposed increase it will represent 17%, assuming that other operating costs remain stable and do not experience significant variations.
This increase is against the guidelines developed by global authorities through ICAO
According to Document 9082 of the International Civil Aviation Organization (ICAO), which Mexico is a signatory State, States are encouraged to follow four basic principles in setting tariffs:
- Non-discriminación
- Relation to operating costs
- Transparency
- User consulting
The present measure does not make it clear how the 77% increase is related to operating costs since, at the moment, hasn’t been informed how the figures were calculated or the accounting, nor has been taken into account the point of view of the users and the impact that this increase will have.
Aviation is an industry recognized for its low margins and for transferring its efficiencies and savings to end users. In Mexico this is no exception and, if we adjust the income per 100 Passenger Kilometers index for inflation, we could see that in Mexico, in real terms, tariffs have decreased in the last few years. More accurately, at constant 2022 prices, between 2019 and 2022 air tariffs in Mexico were reduced by 12%, making it easier for more people in the country to access the safest and most efficient means of public transport.
The increase in operating costs would lead to transfer those costs to passengers, making it a less affordable for the population that does not only need to travel for tourism.
We are convinced that the review of this tax policy is essential in order to foster even greater growth of air transport in the country. Listening to the voice of the users is fundamental to implement appropriate policies that generate growth for everyone.
