Palma.—Alvaro Middelmann, Vice President for the Spanish and Portuguese branch of Air Berlin said yesterday that the increase in landing fees, coupled with a punishing VAT hike, could jeopardise Spain as a holiday destination.

Speaking to journalists yesterday, Middelmann insisted that he failed to understand why the sector of industry which has the key to helping Spain out of its economic crisis is being so heavily penalised.

He said that the rise in VAT of between 8 percent to 21 percent in activities such as golf is seriously undermining the success of tourism in the Balearics and the Costa del Sol in the low season.

Middelmann said that the tourist industry would have to wait until next year before it could judge the true impact on the profitability of this season of the increases in landing fees and VAT which were imposed on 1st July and 1st September respectively. “It's too soon to say this season has been a good one,” said Middelmann.

He said though that the rise in fees and VAT would undoubtedly have an effect on reservations next year.
No compensation
Meanwhile, Paul Verhagen, Air Berlin's Area Manager for Spain and Portugal pointed out that the 20% discount in airport taxes that the government is allowing for transit passengers at airports belonging to the Spanish National Airports Authority doesn't compensate at all for the rise in landing fees. “These discounts appear to be totally inadequate when considering that airports such as London and Amsterdam make allowances of 50% for the same circumstances. Middelmann claimed that lowering landing fees out of season by 20 percent was not going to be the deciding factor in whether an airline schedules a flight or not.

Asked about Air Berlin's business in Spain this winter, he said it would be about the same as in 2011 but admitted that passenger volumes had reduced by about 7 percent over the summer in comparison with last year.

The airline has always acknowledged the importance of Balearic airports as an international “hub” accounting for nearly 30% of its business. One of every three of its passengers departs or arrives in Spain.