Thirteen countries will adopt air ticket tax for poor

Asian Tribune

(March 3, 2006) Thirteen countries forged an alliance on Wednesday to adopt a levy on plane tickets to help poor countries fight AIDS and other killer diseases, despite resistance from airlines,  Reuters reported.

A further 25 countries opted not to impose the tax but promised to contribute to a central pot which the core group of 13 will create from the levy to fund the purchase of generic drugs and other medicines to help the poor. Brazil, Britain, Chile, Congo, Cyprus, France, Ivory Coast, Jordan, Luxembourg, Madagascar, Mauritius, Nicaragua, and Norway have now agreed to raise or started raising a sum from air tickets to help the poor, they said in a closing statement. The 25 others included countries such as Germany, Belgium, Austria, South Africa, South Korea and Mexico.

Le Monde (France) writes that the objective of the tax is to improve access to medications while creating a decrease in their prices by negotiating grouped purchases early on, thereby acting as an incentive for drug manufacturers who would otherwise hesitate to enter this market due to the lack of financial viability. French ambassador Michel Kazatchkine in charge of the fight against HIV/AIDS estimates that the EUR300 to 400 million raised will make it possible to have an effect on the market and thus lower costs.

Agence France Presse notes that French officials called the conference a success in getting other countries to adopt the idea championed by President Jacques Chirac -- despite the small number of states that have joined so far and the hesitation of other big Western countries with high numbers of airline passengers. The US opposes the plan, as does the airline industry and business groups, fearing it would burden carriers already struggling with high oil prices and fierce competition. But UN Secretary General Kofi Annan, speaking at the opening of the conference on Monday, hailed the initiative, saying it contributed to the international community meeting its commitment under the Millennium Development Goals.'

Les Echos (France) writes that the approximately 60 NGOs who took part in the two day event are divided over the issue of taxation. Fran็oise Ndayishimiye, a representative from the Global Fund to fight AIDS, malaria and tuberculosis, wished to see the collected tax go directly into the Fund and called for a more "global vision" in administering the money.

R้gis Mabilais from Coordination Sud, which comprises more than 100 French NGOs, was, on the other hand, more supportive of the airline tax. He said the implementation of the tax illustrates real progress from where the world stood on this issue two years ago, when the idea could not even be discussed. However, the organization noted that it was necessary to ensure countries did not enter into these new arrangements by shifting funding from their objective to dedicate 0.7 percent of their national wealth towards development.

The Associated Press further reports that at the conference, a pilot group of 38 countries also agreed to create a structure to make it cheaper to buy medication for those in need. It was hoped that the International Drug Purchase Facility would be finalized by September 2006 at the latest. The facility, promoted by France and Brazil, would help obtain cheap anti-retroviral drugs needed by those with HIV or AIDS.

The Wall Street Journal notes that France's airline ticket tax will range from EUR1 to EUR40, or $1.19 to $47.66, depending on seating class and distance of the flight. It will be added to ticket prices starting in July.

The Asian Tribune is a newspaper published by World Institute for Asian Studies.The original of this article may be seen at http://www.asiantribune.com/show_news.php?id=17215




 

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