Ryanair cutting fares by 30% to fill Catalonia flights

Ryanair Chief Executive Michael O’Leary said: ‘To fill the aircraft we had to lower the fares (for flights to Barcelona) very significantly.’ (PA Photo)
Updated 14 February 2018
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Ryanair cutting fares by 30% to fill Catalonia flights

MADRID: Ryanair has been cutting fares by up to 30 percent to fill flights to Barcelona and other cities in Catalonia as holiday-makers are nervous of political upheaval in the Spanish region, Chief Executive Michael O’Leary said on Tuesday.
Tourist numbers in Barcelona dipped after an attack in August left 16 people dead and an illegal independence vote prompted scenes of police violence and mass protests, but have since rebounded.
Ryanair still plans to increase capacity in Spain as a whole sharply in the coming year, adding 9 percent more flights in the year to March 2019, O’Leary said, compared with an increase of 6 percent in its network as a whole.
“To fill the aircraft we had to lower the fares (for flights to Barcelona) very significantly,” O’Leary told a press conference in Madrid. “The fares are significantly lower as we approach the summer than they were last year,” he said, though demand for travel to Madrid remained strong.
Capacity in Spain has increased in recent years as operators have moved from destinations in the Middle East and North Africa in the wake of attacks on tourists.
The number of international tourists visiting Spain broke records for a fifth straight year in 2017, climbing 8.9 percent year-on-year to 82 million.
One threat to Ryanair’s rapid expansion plans are relations with pilots. While strike threats in December were averted by a pledge to recognize labor unions for the first time, the airline has so far managed to reach a recognition agreement with only one of the seven unions with which it is in talks.
O’Leary said Spain’s SEPLA pilots’ union had not yet responded to offers of a pay rise and terms for union recognition and Ryanair was considering bypassing the union and offering the increase directly to pilots — something it has done in Ireland.
SEPLA said in a statement it had told Ryanair it would not negotiate with it until it allowed it to represent both pilots employed directly and those employed indirectly as contractors.
It also said it would recommend pilots reject a proposed salary increase as long as it was dependent on recognizing Ryanair’s system of employee councils at airports, which it said are appointed unilaterally by management.
The union said it had offered to poll pilots on the proposed pay increase, but that Ryanair had refused to give it a list of serving pilots. Ryanair did not immediately respond to an emailed request for comment.


Jordanian cabinet approves new IMF-guided tax law to boost finances

Updated 21 May 2018
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Jordanian cabinet approves new IMF-guided tax law to boost finances

AMMAN: Jordan’s cabinet on Monday approved major IMF-guided proposals that aim to double the income tax base, as a key part of reforms to boost the finances of a debt-burdened economy hit by regional conflict.
“When only 4 percent of Jordanians pay (personal) income tax, this may not be the right thing,” Finance Minister Omar Malhas said in remarks after the cabinet meeting, adding the goal was to push that to eight percent. The draft legislation was submitted to parliament.
The IMF’s three-year Extended Fund Facility program aims to generate more state revenue to gradually bring down public debt to 77 percent of GDP in 2021, from a record 95 percent.
A few months ago Jordan raised levies on hundreds of food and consumer items by unifying general sales tax (GST) to 16 percent — removing exemptions on many basic goods.
In January subsidies on bread were ended, doubling some prices in a country with rising unemployment and poverty among its eight million people.
The income tax move and the GST reforms will bring an estimated 840 million dinars ($1.2 billion) in extra annual tax revenue that will help reduce chronic budget shortfalls normally covered by foreign aid, officials say.
Corporate income tax on banks, financial institutions and insurance companies will be pushed to 40 percent from 30 percent. Taxes on Jordan’s phosphate and potash mining industry will be raised to 30 percent from 24.
The government argues the reforms will reduce social disparities by progressively taxing high earners while leaving low-paid public sector employees largely untouched.
“This is a fair tax law not an unfair one,” said Malhas, who shrugged off criticism the law is lenient on many businesses connected to politicians whose transactions are not subject to tax scrutiny.
Husam Abu Ali, the head of the Income and Sales Tax Department, said a proposed IMF-recommended Financial Crime Investigations Unit will stiffen penalties for tax evaders. Critics say it will not tackle pervasive corruption in state institutions.
Abu Ali said the government could be losing hundreds of millions of dollars through tax evasion, which is as high as 80 percent in some companies.
The amendments lower the income tax threshold and raise tax rates. Unions said the government was caving in to IMF demands and squeezing more from the same taxpayers.
“It is penalizing a group that has long paid what it owes the state,” the unions syndicate said in a statement.
“It imposes injustice on employees whose salaries have barely coped with price hikes rising madly in recent years.”