TORONTO - Toronto's Pearson airport, long criticized for being one of the world's most expensive to use, is reducing its landing fees and terminal charges in a bid to attract more passenger and airline traffic.

The Greater Toronto Airports Authority, which operates the airport, said Tuesday that landing fees charges to airlines will decrease by 3.1 per cent and terminal charges will drop by 4.7 as of Jan. 1.

"This is fantastic news for our airline partners,'' stated GTAA chief executive Lloyd McCoomb.

"By pricing Toronto Pearson more competitively we are able to decrease the cost of doing business, which is good for airlines, good for passengers and good for the region.''

The move was cheered by travel groups and airlines, who have long pushed for a reduction in fees and charges by both airports and the federal government, saying they affect the competitiveness of Canada's air carriers.

"Air Canada is pleased by today's announcement that the GTAA is cutting fees at Toronto airport and we commend the authority for finding savings and alternative revenue sources,'' stated Montie Brewer, CEO of Pearson's largest tenant.

"(We) now ask the Federal Government to follow the GTAA's example by reducing the rents it charges airports each year ... Ultimately, this is a regressive tax that stifles economic growth.''

Landing fees are charged to the airlines to operate at Toronto Pearson, the busiest airport in Canada, with 31 million passenger in 2006.

They are also passed on to travellers -- raising their ire when they discover the ticket price skyrockets once taxes and airport fees are included. Some Canadians instead choose to drive to U.S. airports, such as Buffalo, to save on their flights.

Terminal charges, for their part, are set to cover the operating costs for the common areas in the passenger terminals.

Same Barone, CEO of the Air Transport Association of Canada, also highlighted the ongoing issues of airport rents, fuel surcharges and security costs -- all constant sticking points between travel groups and the government.

"This year, Pearson will pay more than $150 million to Ottawa (in rent),'' he said.

"Our passengers really are paying that additional tax back to Ottawa, which does nothing for stimulating traffic growth.''

But, he added, ATAC is "always pleased to have the cost that gets passed through to our passengers reduced,'' saying the airport authority "does deserve quite a bit of credit for that achievement.''

"We also encourage them to do more for travellers because we're in a very competitive environment.''

The GTAA did say it would continue to work to make the airport competitive "through cost containment, revenue generation and by working with air carrier partners.''