Commission assesses kerosene tax

May 15, 2005

The Commission has worked out the likely revenue from a potential future tax on aviation fuel.

[mailchimp_signup][/mailchimp_signup]The calculations, which were briefly considered by EU finance ministers last month, include both a tax on kerosene and a charge on airline tickets. This follows the suggestion in January by France’s president Jacques Chirac that money to tackle Third World problems could be raised by taxing aircraft fuel, airline tickets, and financial transactions.

The Commission estimates that a tax of €0.33 per litre of kerosene would generate €6-7 billion in revenue. A €10 charge on each intra-EU flight, coupled with a €30 charge on international flights, would produce a further €6bn.

The 12 finance ministers never intended to reach a decision on the analysis, but T&E director Jos Dings says the presence of the paper is still significant. “There is a growing sense in the industry that some sort of action to combat aviation’s environmental impact will have to happen soon,” he said.

“Some central figures in the industry are pushing the idea of emissions trading, because they fear that by opting for the course of action they are least frightened of, they will prevent more drastic action. Our view is that trading alone will not be enough.”

This news story is taken from the May 2005 edition of T&E Bulletin.

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