Brussels, 21 November 2023
I’ve been with Airlines for Europe for almost 5 months now and in that time there have been almost as many announcements of national taxes on aviation: France has announced a tax on major airports, the Dutch outgoing government recently proposed a tax on transfer passengers, Italy’s proposed 2024 budget allows some municipalities to apply an additional 3 euros per passenger, and most recently the Danish government proposed to introduce a staggered passenger tax that will gradually increase between 2025-2030.
I have to ask myself what the intention behind these additional national taxes really is.
Europe already has rules and taxes in place to decarbonize aviation and these are already delivering reductions:
- Of all the transport modes, only aviation is included in the EU Emissions Trading System – it’s been part of it for over 10 years in fact. The ETS caps and prices carbon and is a clear incentive for airlines to reduce emissions and invest in improving their environmental performance.
- The EU Fit for 55 package set mandatory requirements for the use of Sustainable Aviation Fuels. Just between 2025-2030, European airlines will use 9 million tons of SAF, saving around 30 million tons of CO2.
- In 2022 airlines bought all SAF that was produced for a total of $500 million. Currently, SAF prices are roughly 2 to 3 times the price of kerosene.
- Over the next decade, A4E airline members are investing over €160 Billion in new, more efficient, best-in-class aircraft. These new planes are taking to the skies now, delivering reductions in emissions and in noise.
- Europe’s aviation industry was the first in the world to set out and commit to a roadmap to net zero – Destination 2050. The roadmap was launched in 2021 jointly by airlines, airports, aircraft manufacturers, and air navigation service providers. The additional cost of new aircraft technologies, air traffic management, SAFs, and negative emissions amounts to €820 Billion.
This is not about sustainability. In the case of the Danish proposal, in 2025 1/3 of the tax will be earmarked for decarbonization; for the other countries, no commitment has been made to reinvest the funds back in decarbonizing aviation.
In 2022 A4E airlines paid more than €4 billion in aviation taxes in Europe. These revenues finance national budgets and are rarely reinjected in the aviation sector.
If national governments really want to help offer the choice of sustainable aviation to our children, there is one initiative they can take and it’s on their table right now: reform airspace. Agreeing ambitious change in the Single European Sky negotiations is an opportunity to make flying more efficient and reduce the sector’s emissions by up to 10%.
National tax proposals across Europe fragment our collective efforts to decarbonize what is a hard-to-abate sector, they fragment the European single aviation market and undermine the competitiveness of Europe’s aviation market.
We are transitioning to sustainable aviation, the task ahead is massive but it can be done. It requires difficult decisions from all sides and it requires us all to focus our attention and our resources on the policies and processes we have already agreed and rolled out.