TUI threatens to reduce Belgian-based fleet, but higher passenger tax does not tell the whole story

TUI is considering reducing the number of aircraft based in Belgium, partly blaming the federal government’s decision to increase the passenger departure tax from €5 to €7 from 1 January 2027.

TUI Group chief executive Sebastian Ebel described Belgium’s tax environment as unfavourable and argued that the government must decide whether it wants to preserve affordable holidays for lower-income travellers.

However, the argument requires some perspective. Belgium’s future €7 levy will remain considerably lower than passenger taxes imposed in several neighbouring countries where TUI also operates airlines.

In the Netherlands, the tax already amounts to €30.25 per departing passenger in 2026. From 2027, the Dutch government plans to introduce distance-based rates of around €30 for European flights, €47 for medium-haul services and more than €70 for long-haul journeys.

Germany reduced its aviation tax in July 2026, but still charges €13.03 for most European and Mediterranean destinations, €33.01 for medium-haul flights and €59.43 for long-haul services. For a typical European holiday flight, the German levy therefore remains almost twice as high as Belgium’s planned tax.

A genuine cost, but a modest one

The increase from €5 to €7 represents a significant 40% rise in percentage terms. In absolute terms, however, it adds only €2 per passenger.

For a Boeing 737 carrying around 170 passengers, the additional cost would be approximately €340 per Belgian departure. Across several million passengers, the annual impact could amount to several million euros. That is not insignificant in an industry operating on narrow margins, but it appears insufficient on its own to justify the removal of several aircraft.

The tax is also normally incorporated into the price paid by the passenger. Moreover, it applies to passengers departing from Belgium regardless of where the aircraft operating their flight is based. Moving an aircraft abroad would therefore avoid the tax only if TUI simultaneously reduced its Belgian schedule and transferred capacity to another market.

Belgian consolidation began before the latest increase

TUI fly Belgium’s contraction did not begin with the planned increase to €7.

The airline ended its operations at Liège Airport in January 2026 after concluding that the flights no longer met its profitability requirements. It will also withdraw from Antwerp Airport on 25 March 2027 and concentrate its Belgian operations at Brussels Airport and Ostend. When announcing the Antwerp decision, TUI referred to greater efficiency and more productive fleet utilisation rather than the federal passenger tax.

TUI fly Belgium has also ended its own long-haul operations from Brussels. One Boeing 787-8 was transferred to sister carrier TUI fly Netherlands, while the remaining aircraft was subsequently withdrawn. TUI acknowledged that operating such a small Belgian long-haul fleet was no longer commercially viable.

These decisions indicate that the group was already simplifying and concentrating its Belgian activities before the latest tax increase. The additional €2 may weaken profitability further, but it cannot reasonably be considered the sole origin of the restructuring.

Wider difficulties in TUI’s airline and tour operator business

The warning also comes as TUI’s broader airline and tour operator division is under financial pressure.

The group’s Markets + Airline division, which combines its airlines, tour operators and sales businesses, recorded an underlying operating loss of €17.4 million during the third quarter of its 2026 financial year. A year earlier, the same division had generated a profit of €49.7 million.

Revenue fell by 7.9%, customer numbers declined by 6.4%, and the average flight load factor decreased from 94% to 91%.

TUI blamed the deterioration on weaker demand following the Middle East crisis, higher fuel prices, cautious consumers, increasingly late bookings, additional airline capacity and pressure on holiday prices. It has already reduced the airline capacity sold at its own commercial risk by 5%.

The group can allocate aircraft among its airlines and direct new deliveries towards the markets offering the highest returns. Belgium is therefore competing not only with Germany and the Netherlands, but also with the United Kingdom, the Nordic countries and other European leisure markets.

A Belgian-based aircraft could consequently be transferred elsewhere even if passenger taxes there are higher. The departure tax is only one part of a much broader calculation that also includes labour costs, airport and air navigation charges, aircraft productivity, market size, ticket prices and expected load factors.

A convenient political argument

The Belgian tax is therefore a genuine additional expense, but it also provides TUI with a useful instrument for putting pressure on the government.

By publicly linking a possible fleet reduction to taxation, the group can seek more favourable conditions while presenting any capacity cuts as the consequence of government policy rather than an internal commercial decision.

Ryanair frequently follows a similar strategy, placing airports and governments in competition before moving aircraft towards markets offering the most attractive overall conditions.

No evidence of mismanagement, but an incomplete explanation

The publicly available figures do not provide sufficient evidence to conclude that TUI fly Belgium has suffered from poor management. TUI does not publish a separate profit-and-loss account for the Belgian airline, making its individual performance difficult to assess.

Nevertheless, the planned €2 increase is too small to provide a convincing explanation on its own for a substantial fleet reduction.

The withdrawal from Liège and Antwerp, the termination of Belgian long-haul operations, the deterioration in TUI’s wider airline and tour operator results, and the group’s continuing consolidation strategy all point to deeper commercial considerations.

The fairest conclusion is therefore that the higher passenger tax places additional pressure on an already challenged Belgian operation. But it also gives TUI a politically effective justification for accelerating—or announcing—a rationalisation that might have occurred anyway.