So all those hard words against low-cost airlines have been swallowed or eaten and Ryanair is to fly between Malta and a few European airports. I wonder what happened to make the government change its mind: possibly the prospect of Winston Zahra, Kevin De Cesare and a couple of other hoteliers sitting down in the road outside Francis Zammit Dimech’s office, or chaining themselves to his front door in Balluta and refusing all sustenance. Well, I don’t know – the government bangs on at people about how change is difficult but essential for survival (no pain, no gain and so on), and then it seems sometimes that nobody is more afraid or wary of change than those who call the shots. If other European cities – and in tourism terms, Malta is a city and not a country – have found that low-cost airlines work very well for them, then it’s a mystery why they should have been thought a bad idea for this place. Business is business, and anything that brings in the punters is fine.
From the perspective of a country and its people, airlines are a means to an end, and not the end in itself. Airplanes are just public transport in the air, and we expect of them what we expect of trains, buses and taxis, with allowances for the complications of passport clearance, bag checking and terrorism. When airlines become an end in themselves, this basic principle is disrupted and the customers end up being sacrificed or penalised for the survival of the business – the airline – or the airline is kicked around in the government’s interests.
We need low-cost airlines because they will help fill our hotels and restaurants and keep us ticking over. As the chairman of the Malta Tourism Authority was quoted as saying about the decision to allow them into the country: “Better late than never.”
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Of course, it will make little difference to us who live here, because with an average of Lm50 in taxes and surcharges levied on every air ticket, we can never get a cheap one. Even if we get our tickets supposedly for nothing, they will still cost us around Lm50, and by today’s market standards, that is anything but cheap. You can tell that the government is made up of lawyers who are pretty much clueless about business because they have whipped their eyes right off the ball. All they can see is the Lm4 million or so in revenue that the blessed departure tax of Lm20 per air ticket, piled on top of the airport tax and fuel and other surcharges, is hoovering up into the national coffers each year. This is called short-term thinking, or in the language of fairy-tales, killing the goose in the mistaken belief that it will allow you to grab all the golden eggs at once, rather than waiting for it to lay one golden egg a day. That fairy-tale is a very basic lesson in commerce, and I am surprised at the number of important people who seem not to have learned it.
The ridiculous level of taxes and surcharges that we are obliged to pay each time we buy an air ticket may be giving the government lots of lovely lolly to spend on essentials like real roads – come on now, we’re waiting – but it will also be the eventual undoing of Air Malta by disturbing the price-setting mechanism of demand and supply. The current prices that we are paying for our air tickets are false and unnatural: they have nothing to do with demand and little to do with supply. Taxes and surcharges are an integral part of the price, so it is disingenuous for the airline or its master, the government, to claim that Air Malta has good ticket prices. It doesn’t, and it cannot offer them, not when we have to start counting at around Lm50. Yes, these taxes affect the business of other airlines that sell to Maltese, too, but this is chicken-feed to them. On the other hand, Maltese customers make up a great part of Air Malta’s business, because as patriotic people we prefer to fly with the national airline whenever it is possible to do so. What the government is doing with its blinkered tax measures is forcing the national airline to sell tickets to its core customer group – the Maltese – at higher prices than it does to its other customers. How’s that for laughs? When customers are loyal, a business should be able to charge them less, and not be forced to charge them more than they do to everyone else. Frequent flier miles are simply not the point.
The government, instead of rubbing its hands with glee at the thought of another Lm4 million by the end of the year, should start thinking clearly for a change and do what it takes to make sure that Air Malta is allowed to charge its core customers real prices for tickets and not prices they have been forced to hike up to a false level while apologising for the tax element. The other day, I bought two tickets to Catania airport, a flight in which the plane more or less goes up and then immediately down again. They cost Lm180 for the two, the greater bulk of which was made up of various taxes and surcharges. It’s horrendously expensive, and it’s pointless having anyone tell me that the price of the “actual ticket” is only X. As far as I’m concerned, the price of the “actual ticket” was around Lm90, because that’s how much I had to pay to get it. I don’t give a monkey’s cuss how much of it goes to Air Malta and how much to the government or the airport.
It is the government, ironically, that is preventing the very level playing field that it likes to say is one of its main aims in air travel. One of its angriest arguments against low-cost airlines – before it ate its words – was that they would disturb the level playing field by demanding subsidies of the government. Yet here is that same government, turning this argument on its head by, unbelievably, demanding that we subsidise its myriad activities each time we buy an air ticket.
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The government does not seem to understand that it is the very principle which is wrong. No government should tax its citizens in return for allowing them the privilege of leaving the country, preventing them from leaving if they refuse to pay the tax, unless they are strong swimmers or have access to a private boat.
The more I think about it, the more appalling it seems. I shan’t sleep tonight, thinking of the ramifications. Yet the people who decide these things seem to think that it’s all about the money. It isn’t. It’s the principle that’s fundamentally wrong. A government may not grant permission to its citizens to leave the country only on payment of a specific tax. Even if the departure tax were to be set at 50 cents, it would still be unacceptable because the concept of a departure tax for the citizens of the country that levies the tax is intrinsically wrong and immoral. It’s the politics of feudalism.
I had lunch the other day at a port-shipper’s lodge in Porto. My host told me that his children had just left for boarding school in England. I asked him whether he missed them. “We never go longer than two or three weeks without seeing them,” he said. “It only costs a few euros to fly over, as much as a taxi across the river.” My taxi across the river had, earlier that morning, cost me five euros. Then came the inevitable question, the one I had dreaded because the answer would make the supposedly rational government of Malta seem about as bongo-bongo-land as it did in the days of Dom: “Do you get cheap flights out of Malta?”
I replied that others might, but that we Maltese don’t because we are taxed for leaving the country. There was a moment while this information was digested, and then a burst of disbelieving laughter. “What? You have to pay a tax to leave your own country? That’s crazy.” Oh dear, here we go, I thought – and this time, I really didn’t feel like sticking up for Malta, as I usually do, because I would have to be a brainless vegetable to try and justify this medieval tax measure.
Somebody else at the table wanted to know why the government doesn’t tax visitors to Malta instead, because there’s a moral and economic justification for this, given that they are using scarce and expensive resources to which the Maltese are entitled by virtue of being tax-payers. Sadly, my answer only served to make Malta seem even more bongo-bongo-land and desperate: “They don’t want to tax visitors because it might scare them off. They want to keep the prices down yet they still need the money, so they tax us when we leave instead.”
Another round of laughter and then someone mentioned that in Madeira they see things rather differently. They tax the arrival – or perhaps it’s the departure – of everyone who can’t prove residency on the island. It’s the visitors who are taxed, because they are the ones using up the scarce and valuable island resources that the people who live in Madeira have paid for.
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Now that the government has chosen to stand like a feudal baron outside a toll gate, extracting tax from those who wish to pass through the valley below his castle or turning them back (at least we’re not stabbed with a lance and robbed), perhaps it might consider reintroducing public stocks, so that annoying people may be placed in them and pelted with rotten eggs. Then it might try moving on to a little light garrotting and hanging, and perhaps a touch of heretic-burning outside Café Cordina. It’s a slippery slope.