Spain to reward airlines for increased passenger numbers

In a move to boost its flagging tourist industry, Spain announced Wednesday that airlines that increase passenger numbers in the first half the year would receive tax breaks in the second half.

Prime Minister Jose Luis Rodriguez Zapatero told parliament the measure was aimed at "supporting the tourism sector."He said airlines that increase passenger numbers in the first six months of 2009, compared to the second half of 2008, would see airport taxes cut by 100 percent for the rest of the year.

"It is an incentive measure to boost tourism and (the number of) passengers" since airlines will pass on the cuts to passengers, he said.Transport Minister Jose Blanco said the measure would cost the country's airports authority around 20 million euros (27 million dollars).

However, four Spanish airline associations released a joint statement condemning the measure as "discriminatory and confusing" and said it would "not have any positive effect" for Spanish carriers. Spain is the world's second biggest tourist destination after France.

The tourism sector accounts for about 11 percent of the country's jobs and gross domestic product but the global economic crisis has hit the industry hard. In the first quarter of 2009, tourist arrivals were down 16.3 percent at 8.9 million.

Source: eTurboNews