Germany Slashes Air‑Traffic Tax by Billions, Cutting Passenger Fees by Up to €11
Politics

Germany Slashes Air‑Traffic Tax by Billions, Cutting Passenger Fees by Up to €11

The federal government plans to cut the air‑traffic tax in the middle of the year, according to a draft from the Finance Ministry reported by the FAZ. The measure would take effect on 1 July 2026 and lower the tax to the level it held in May 2024, thereby fulfilling a pledge made in the coalition agreement between the CDU, CSU and SPD and agreed upon by party leaders late last year.

The draft lays out the new rates in detail: for short‑haul (domestic) flights the tax falls from €15.53 to €13.03 per passenger; for medium‑haul flights from €39.34 to €33.01; and for long‑haul flights from €70.83 to €59.43. Depending on distance, passengers would therefore save between €2.50 and €11.40 each.

The air‑traffic tax is one of several passenger‑related levies that contributes to the federal share of airport operating costs. Whether the lower tax actually translates into cheaper fares will depend on airlines’ willingness to pass the savings to passengers. At the same time, passengers face rising government fees for airport security checks and air‑traffic control, and oil price hikes driven by the Iran war are pushing airline costs higher.

From the government’s perspective, the tax cut will cost more than €1 billion over the coming years. The Finance Ministry projects a revenue loss of €185 million in 2026 and a shortfall of €340-355 million per year from 2027 to 2030.

The contentious issue of how to finance the revenue loss-previously debated between the Union and the SPD-has now been resolved, with the SPD’s position prevailing. The draft states that the reduced income in budget item 60 will be fully compensated by savings in budget item 12, which covers the Ministry of Transport.

Transport Minister Patrick Schnieder (CDU) will have to cut about €350 million in the ministry’s budget from 2027 onward. Although the ministry benefits from the €500 billion special fund for infrastructure and climate protection (SVIK), the cuts could be painful because they delay a massive backlog of road and rail projects.

Air‑transport industry groups are likely to welcome the proposal. The German Aeronautics Association (BDL) had previously warned that the country was risking a loss of competitive position. In 2025, European air‑traffic capacity reached 106 % of pre‑crisis levels, while Germany lagged behind at roughly 89 %. Passenger numbers at German airports rose 3.6 % to 219.6 million, yet the overall recovery remains sluggish.