The Arab Air Carriers Organisation (AACO) welcomed the removal of a controversial US proposal to levy corporation tax on Arabian Gulf airlines from Donald Trump’s sweeping tax reform bill, which was approved by the US Senate on Saturday morning.
“Reason prevailed,” said Abdul Wahab Teffaha, AACO’s secretary-general Abdul Teffaha told The National on Saturday, after the provision, tabled last month by US Senator Johnny Isakson of Georgia, was pulled from the bill.
The amendment, added last month by US Senator Johnny Isakson of Georgia, called for airlines headquartered in foreign countries to pay corporation tax if the carrier’s home country has fewer than two arrivals and departures per week operated by major US airlines, and/or the carrier’s country does not already have an income tax pre-agreement with the US.
The Wall Street Journal reported the provision was one of three removed from the bill under the US Senate’s Byrd Rule, which dictates that all legislation going through budget reconciliation must have an impact on the budget.
The proposal introduced by Senator Isakson, whose Georgia constituency is home to Delta Air Lines, was strongly criticised by the AACO – whose 30-strong membership includes Emirates, Etihad Airways and Gulf Air – who warned the move could spark retaliatory measures from other countries, leading to rising costs for airlines and consumers.
The International Air Transport Association also criticised the move.
"Reciprocity between governments on taxation is a vitally important part of this cooperation," the industry body said last month. "If enacted, the Isakson provision would upend decades of precedent - which the US has long supported - on the taxation of international aviation. It would directly impact multiple airlines from multiple countries."
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The decision to drop the proposal was unsurprising, given the crucial role Arabian Gulf carriers play for the US aircraft manufacturing industry, said Saj Ahmad, chief analyst at Strategic Aero Research.
“The reality is that GCC airlines are regularly placing orders worth billions of dollars in Boeing airplanes and engines from GE which support well over 270,000 aerospace jobs within the United States alone, not to mention the countless others in the extended supply chain,” he said.
“The US President is aware of job creation initiatives as part of his election pledge remain a priority.”
The move was seen as the latest salvo in a bitter dispute between three largest US airlines – United, Delta and American Airlines – and their Arabian Gulf counterparts, Emirates, Etihad Airways and Qatar Airways.
Mr Isakson’s office and Delta did not respond to requests for comment.
For years, the US carriers have lobbied federal government to curb Gulf carriers’ expansion in the states, which they claim represents “unfair competition” and breaches Open Skies agreements. The Gulf airlines say that the claims are untrue and that their American rivals cannot compete with their superior service.
But the Isakson proposal was criticised by US Airlines for Open Skies, a US body consisting of Atlas Air Worldwide, FedEx, Hawaiian Airlines, and JetBlue Airways.
“This special interest ploy was designed to hurt the Gulf carriers but would actually impact airlines from as many as 14 countries and territories, such as Jordan, Ethiopia, and Malaysia,” the group said last week.
“In addition, the provision opens the door to retaliatory taxes that would harm US airlines, particularly US cargo carriers.”
The US Senate Tax Cuts and Jobs Act was approved Saturday morning UAE time, bringing what would be the first major legislative achievement of Donald Trump’s presidency a step closer.
The act is designed to usher in the largest tax overhaul of the US tax system in decades, permanently lowering the corporate tax rate to 20 per cent from its current level of 35 per cent.
Senate Democrats, who unanimously voted against the act, warn that it primarily benefits the wealthy and large businesses, while the non-partisan Senate Joint Committee on Taxation warned it will significantly deepen the US budget deficit.
Results
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UK-EU trade at a glance
EU fishing vessels guaranteed access to UK waters for 12 years
Co-operation on security initiatives and procurement of defence products
Youth experience scheme to work, study or volunteer in UK and EU countries
Smoother border management with use of e-gates
Cutting red tape on import and export of food
Killing of Qassem Suleimani
Specs
Engine: 51.5kW electric motor
Range: 400km
Power: 134bhp
Torque: 175Nm
Price: From Dh98,800
Available: Now
QUALIFYING RESULTS
1. Max Verstappen, Netherlands, Red Bull Racing Honda, 1 minute, 35.246 seconds.
2. Valtteri Bottas, Finland, Mercedes, 1:35.271.
3. Lewis Hamilton, Great Britain, Mercedes, 1:35.332.
4. Lando Norris, Great Britain, McLaren Renault, 1:35.497.
5. Alexander Albon, Thailand, Red Bull Racing Honda, 1:35.571.
6. Carlos Sainz Jr, Spain, McLaren Renault, 1:35.815.
7. Daniil Kvyat, Russia, Scuderia Toro Rosso Honda, 1:35.963.
8. Lance Stroll, Canada, Racing Point BWT Mercedes, 1:36.046.
9. Charles Leclerc, Monaco, Ferrari, 1:36.065.
10. Pierre Gasly, France, Scuderia Toro Rosso Honda, 1:36.242.
Eliminated after second session
11. Esteban Ocon, France, Renault, 1:36.359.
12. Daniel Ricciardo, Australia, Renault, 1:36.406.
13. Sebastian Vettel, Germany, Ferrari, 1:36.631.
14. Antonio Giovinazzi, Italy, Alfa Romeo Racing Ferrari, 1:38.248.
Eliminated after first session
15. Antonio Giovinazzi, Italy, Alfa Romeo Racing Ferrari, 1:37.075.
16. Kimi Raikkonen, Finland, Alfa Romeo Racing Ferrari, 1:37.555.
17. Kevin Magnussen, Denmark, Haas Ferrari, 1:37.863.
18. George Russell, Great Britain, Williams Mercedes, 1:38.045.
19. Pietro Fittipaldi, Brazil, Haas Ferrari, 1:38.173.
20. Nicholas Latifi, Canada, Williams Mercedes, 1:38.443.
UAE currency: the story behind the money in your pockets
FA Cup quarter-final draw
The matches will be played across the weekend of 21 and 22 March
Sheffield United v Arsenal
Newcastle v Manchester City
Norwich v Derby/Manchester United
Leicester City v Chelsea
SPECS
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Soldier F
“I was in complete disgust at the fact that only one person was to be charged for Bloody Sunday.
“Somebody later said to me, 'you just watch - they'll drop the charge against him'. And sure enough, the charges against Soldier F would go on to be dropped.
“It's pretty hard to think that 50 years on, the State is still covering up for what happened on Bloody Sunday.”
Jimmy Duddy, nephew of John Johnson
UAE currency: the story behind the money in your pockets
Copa del Rey
Barcelona v Real Madrid
Semi-final, first leg
Wednesday (midnight UAE)
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
Volvo ES90 Specs
Engine: Electric single motor (96kW), twin motor (106kW) and twin motor performance (106kW)
Power: 333hp, 449hp, 680hp
Torque: 480Nm, 670Nm, 870Nm
On sale: Later in 2025 or early 2026, depending on region
Price: Exact regional pricing TBA
UAE currency: the story behind the money in your pockets
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
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