THE EUROPEAN COMMISSION has withdrawn a legal challenge against the government’s travel tax, in light of the recent decision to replace the previous two-tier structure with a single flat fee.

The Commission had claimed that the dual nature of the tax – which was charged at €2 per passenger for flights within 300km of Dublin, and €10 for other flights – has discriminatory towards people from other member states who therefore had to pay more to enter the country.

European Law bans member states from introducing higher charges or stricter requirements for international air travellers than for domestic flights –  a principle the Commission said was breached by the extra tariff for longer journeys.

The Commission wrote to Ireland in March 2010, a year after the tax was put in place, raising its concerns about the tax.

This morning, however, the Commission said it was withdrawing its action in light of an amendment made by former tourism minister Mary Hanafin in the last Budget, when the tax was replaced with a single-band €3 levy.

The current case was no longer relevant given the amended rate, which ‘now complies with EU law’, it said.

Labour MEP Prionsias de Rossa welcomed the decision, but described the “crude air travel tax [as] always a bad idea” and said it should not have taken the previous government so long to repeal the tax at it existed.

The €3 tax is set for abolition by the new coalition under its programme for government.