Originally Posted by
duvin
You're probably talking about sales taxes? International air and sea transport are exempt from VAT in the EU.
Leeham has an interesting thread, which doesn't seem completed yet. I'd be interested in reading their final analysis. I have always believed that ULCC transport to the UK doesn't work because the taxes are too high, and the distance (fuel) is too high. You'd need an average fare above $600 to pretty much breakeven. And you have to get that without any biz class pax. I don't think there is much demand to "stimulate" at that price point -- and coach fares are already often below that price.