Ryanair May Backdate Fare Increases

Ryanair passengers are reportedly going to face extra charges on bookings they have already paid for due to plans by the Spanish government to increase the nation’s airport taxes. Millions of customers who already booked flights to or from a Spanish airport were sent an email from the budget carrier this week, which explained that the airline may have to charge them more for their flights due to ‘government-imposed (tax) increases’.

In the terms and conditions stated by Ryanair, customers are obligated to pay for any extra charges, fees or taxes on flights, even after they have already made and paid for their booking. The airline says the tax hike is due to take effect in the coming weeks. It claims not being able to reveal details of how much extra it will charge or when it will be done. However, it told customers they would contacted before the extra money is taken out of their accounts.

Ryanair chief executive Michael O’Leary says that this comes from the draft budget put up by the Spanish government. It suggests that airport charges could soar, leading to the carrier charging more to passengers who have already booked and paid for flights. However, he added that passengers who objected to paying extra could get a full refund.

Ryanair head of communications Stephen McNamara explained further that the Spanish government’s budget proposes to increase the charges at Barcelona Airport and Madrid-Barajas Airport by double, while it would impose small rises at other airports in the country. It appears the increases will become effective immediately once the budget is passed. Any passengers who have booked flights already for this summer will be forced to pay the higher airport fees if they are approved with the budget.

A Civil Aviation Authority spokesman has highlighted how unusual this decision is. Carriers are obligated to collect taxes on behalf of the governments whose countries passengers are arriving in or departing from. Airlines are responsible for collecting the additional amount of taxes when they are increased. Some carriers take the option to absorb the cost themselves, instead of passing it onto their passengers. However, this is a commercial choice, making it up to the individual carrier to decide how they deal with a government’s tax hikes.

Meanwhile, there are reports that Ryanair may raise its fares overall due to a sudden increase in staff costs. This could be done after a ruling that changes how airlines pay social security contributions for members of their workforce. Ryanair currently pays contributions according to Irish regulations, whose rates are among the cheapest in the European Union. No matter where the carrier’s pilots and cabin crew live, they are employed under Irish contracts since Ryanair is registered in Dublin.

However, new European Parliament legislation aims to force airlines to pay social security contributions based on where the workers are located. This means Ryanair workers based in France would receive the rates applicable in France. Ryanair says this is another example of how regulations that serve no purpose, except to increase air travel costs, are imposed by the EU. The company believes the changes will reduce competitiveness among EU members and claims the move is another hit on the free movement of labour, which used to be a founding principle of the single market.

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