• 

  Ryanair

  IATA/ICAO Code:

  FR/RYR

  Airline Type:

  Low-Cost Carrier

  Hub(s):

  Dublin Airport, London Stansted Airport, Milan Bergamo Airport

  Year Founded:

  1985

  Airline Group:

  Ryanair Group

  CEO:

  Eddie Wilson

  Country:

  Ireland

Hungary has recently fined international air carrier Ryanair 300 million Forints ($780,000). The fine comes following a consumer protection investigation. The fine is reportedly a part of a new tax that has been recently added to air carriers. The airline has responded, requesting an appeal.

Hefty fines

On Monday, August 8th, 2022, the Justice Minister of Hungary announced that Ryanair is legally bound to pay 780,000 dollars to the Hungarian state. The announcement was made shortly after a consumer protection investigation had been conducted on the airline. The fine results from a recently imposed tax geared towards taxing any profit that the state deems to be extra profit.

Ryanair responded to these fines in an email just hours ago. The airline stated that it was ready to appeal this fine in the email. The airline referred to it as a baseless fine handed out by the Hungarian Consumer Protection Agency.

An unwelcome tax

This is the first time Ryanair has been burdened with this relatively new tax placed on large companies. The tax was introduced in May 2022 when the government, under the leadership of Prime Minister Viktor, introduced a new tax worth 800 billion forints (over 2 million dollars). The tax was intended to help rebuild the government's budget after the prime minister used a significant portion of its capital to assist in his re-election.

The tax is geared toward taxing major companies for what it considers to be extra profits. This tax does not replace any previously existing taxes. It is simply an additional tax that companies are required to pay for being more profitable than they need to be, according to the Hungarian government.

Previously, Ryanair had asked that the government remove this misguided tax. Stating that it would hurt the growth of the Hungarian travel industry and its overall economy. This tax applies to more businesses than just the airlines. However, regarding the airlines, this tax is charged following the number of departing passengers, so the airlines may soon be required to add additional fees to passenger tickets to account for this increased tax.

The airline stated that it would need to redirect growth capacity to other countries working to rebuild the industry in the aftermath of the COVID-19 pandemic, not hinder it further. WizzAir also commented on the new tax. Stating that it would take a long time for the industry to return to its pre-pandemic levels and that this tax will only slow that recovery.

Hungary reaffirms its stance

The Hungarian government backs this new tax considering it to be justified. It affirms that the investigation uncovered problems that were harmful to the consumer. It claims that the airline uses unfair business practices to obtain additional profits. Justice Minister Judit Varga stated,

“The consumer protection authority has found a breach of the law today, because the airline has misled customers with its unfair business practice,”

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Ryanair has been fined 780,000 dollars from the Hungarian government. This fine is reportedly the tax due to the Hungarian government under a recently imposed tax geared towards taxing all extra profit made by large companies. This fine comes after an investigation reportedly discovered that the airline is using an unfair business strategy to make additional profits from its customers. The airline has responded by requesting an appeal.

What do you think of this fine? Let us know in the comment below.

Source: Reuters