The Hungarian government around Viktor Orban has escalated the dispute with the low-cost airline Ryanair to the next level of escalation and imposed a fine of the equivalent of 760.797 euros on the carrier. The background is that the low coster is massively defending itself against the special tax for airlines.

The Orban government decided a few weeks ago that so-called excess profits should be skimmed off from companies. The aviation industry was also considered. While Wizz Air is remarkably quiet, the Irish competitor's management has been loudly banging on about this special tax and also announced that passengers will be billed for it. Those who do not want to pay for this will not be taken along.

Ryanair sent additional requests to passengers shortly after Viktor Orban's decree came into force. In concrete terms, this means that the special tax is also collected retrospectively for existing bookings. Those who are not prepared to make the additional payment will not be promoted. But that is exactly what the Orban government did not want, because it has ordered that the special levy must be paid by the companies and must not be passed on to passengers. Shortly after Ryanair's behavior became known the consumer protection minister rumbled that "Hungarian families must be protected".

The approach taken by the Obran government is controversial in the aviation industry, because not all carriers have returned to profitability and the margins are very low, especially from Hungarian airports due to low purchasing power. What is striking, however, is that the Hungarian low-cost airline Wizz Air, which rarely spares criticism of politics outside of Hungary, is taciturn. It will take a long time for the industry to return to pre-pandemic levels and this tax will only slow that recovery, the pink low-cost airline said. At Ryanair, the matter was made a top priority, so that Michael O'Leary himself rumbled against the special tax and that also at international level.

Ryanair wants to fight the fine legally

The Hungarian authorities seem to care little about Ryanair's opinion. The consumer protection authority imposed a fine of 300 million forints (the equivalent of around 760.797 euros) on the low-cost airline. The Hungarian Minister of Justice, Judit Varga, publicly stated that Ryanair would be obliged to transfer the said Somme to the state. "The consumer protection authority has today found a violation of the law because the airline has deceived customers with its unfair business practices," said the government member.

The airline concerned has already confirmed that an appeal will be filed against what they consider to be an "unlawful fine". The fine imposed by the Hungarian consumer protection authority is considered unlawful and they do not want to put up with it. It remains to be seen whether the low-cost airline will be able to successfully take action in Hungary, as Ryanair has rarely been successful in courts in this country. Some time ago, Hungarian judges prohibited the carrier from using the Buzz brand because the risk of confusion with Wizz Air would be too great.

Hungary also wants to improve the treasury on airline costs

The financial situation of the Hungarian state was already extremely tense before the corona pandemic. During the so-called financial crisis, the country narrowly avoided national bankruptcy. This could only be averted with the help of fresh funds from Brussels, but also from Moscow. Since the European Union's corona aid is on hold for a variety of reasons, but Viktor Orban has distributed numerous extremely expensive "optional sweets", urgent attempts are being made to obtain fresh liquidity.

For example, in May 2022 a tax was introduced to siphon off profits from large companies. The Hungarian government assumes that this should flush at least around two billion euros into the cash-strapped state coffers. This was also sold to the population as "protection of Hungarian families".

Not only energy suppliers are affected, but also the transport industry with a focus on aviation. The Orban government believes that the airlines would make particularly high profits and they want to skim them off with the special tax that came into force in this segment on July 1, 2022. As for the airlines, this tax is calculated according to the number of departing passengers, so airlines may soon be forced to add additional fees to the flight tickets to cover this increased tax. However, the Hungarian government wants to prevent the transfer and in particular the subsequent billing after booking.