Taxing aviation kerosene in the EU would slash aviation emissions by 11% (16.4 million tonnes of CO2), have no net impact on the economy and would generate €27bn in revenues every year, according to a leaked European Commission report.
The unpublished report was written in 2018 and leaked by Brussels-based campaign ground Transport and Environment yesterday (May 13). It suggests that the bloc might be close to a shift in policy regarding the tax break, that sees airlines pay no tax on kerosene sold in Europe.
The EU Commission recently registered a citizen petition that calls for an end to the kerosene tax break, and a Commission spokesperson confirmed to AirQualityNews that they are ‘evaluating the current rules around energy taxation to see if there is scope for more environmentally-friendly policies that support the EU’s climate change commitments.’
Transport & Environment believe the leaked report ‘debunks the industry’s myth’ that the economy would be irreparably damaged if airlines were forced to pay tax on kerosene.
On Friday (May 10), AirQualityNews published a report that discussed how aviation got to this point and why public pressure around emissions may force through a change in legislation.
Bilateral agreements rising out of the Chicago Convention 1944 meant that airlines paid zero tax on kerosene for decades.
However, in 2003 the EU introduced the Energy Taxation Directive (ETD), that freed EU member states to tax kerosene on domestic flights, just as the USA, Japan, Brazil and even Saudi Arabia now does.
Member states could also tax fuel on intra-EU flights and it’s one of the few EU laws that doesn’t require unanimity.
This means the UK could do a deal with France or another member state and bring in a kerosene tax. This hasn’t happened and other than the Netherlands, no country has expressed any interest in making the first move.
Bill Hemmings, aviation director of Transport & Environment, said: ‘Aviation’s decades-long kerosene tax holiday needs to end now.
‘This is essential to fight climate change and will help the millions afflicted by unbearable aircraft noise. Europe’s unique and deplorable status as a kerosene tax haven is indefensible.’