Aviation taxation and subsidies includes taxes and subsidies related to aviation.
Taxation is one of several methods to mitigate the environmental impact of aviation.
According to the Amsterdam-based international environmental organisation Friends of the Earth (2005), aviation does not pay tax on fuel and aviation's expansion is fuelled by its exemption from taxes. In the UK, aviation got £9 billion tax free benefits in 2003. Friends of the Earth argued that fuel tax would give incentive to improve the energy efficiency of operations, and would be a more effective response than emission trading.
Historically, EU aviation fuel was tax free and applied no VAT. Domestic fuel taxation in the EU was permitted from 2003 by the Energy Taxation Directive (2003/96/EC) and on intra-EU with bilateral agreements. In 2018 Germany applied 19% VAT on domestic airline tickets. Air fuel tax 33 cents/litre equal to road traffic would give €9.5 billion in the EU. Applying a 15% VAT in all air traffics within and from Europe would be equal to €15 billion.
In November 2019, the Finance Ministers of Belgium, Bulgaria, Denmark, France, Germany, Italy, Luxembourg, the Netherlands and Sweden presented a joint statement calling on the European Commission, more specifically European Commissioner for Climate Action Frans Timmermans, to introduce EU-wide taxes on aviation so as to charge the entire aviation industry more for its emissions and pollution, and put all member states on level pegging. Citing the fact that aviation causes around 2.5% of global CO2 emissions, the Ministers proposed both uniform air passenger taxes as well as kerosene taxes (both excise duties and VAT).In a September–October 2019 poll conducted by the European Investment Bank (EIB) amongst 28,088 EU citizens from the then 28 member states, 72% said they would support a carbon tax on flights.
Austria introduced a Flight Tax Act (Flugabgabegesetz, FlugAbgG) in April 2011similar to the German aviation taxation system. In 2013, the fees for short and medium-haul flights were reduced from 8 euros to 7 euros and from 20 euros to 15 euros respectively, and halved again in 2018. According to §5.1 of the Flight Tax Act, the flight tax depends on the distance to the destination airfield per passenger:
During the COVID-19 pandemic, airlines in Europe had to temporarily cease most operations and had requested a total of 12.8 billion euros in government support by mid-April 2020, according to a Transport & Environment, Greenpeace and Carbon Market Watch report. At the time, Austria was the only country which insisted (through Minister of Climate Action, Environment, Energy, Mobility, Innovation and Technology Leonore Gewessler of the Greens) that a government bailout of its flag carrier (Austrian Airlines, with about 7,000 employees) should be linked to climate targets. On 8 June 2020, the Austrian conservative–green coalition government concluded a support deal for Austrian Airlines (a subsidiary of Lufthansa) for 150 million euros in taxpayer grants, and 300 euros in banking loans that are to be paid back. This was significantly less than expected (Austrian Airlines had applied for 767 million euros), and came under the following conditions:
On 9 July 2019, French transport minister Élisabeth Borne accounced that France would introduce an eco-tax on passengers in 2020. Flights within the EU, including domestic flights, would be taxed 1.5 euros for economy class and 9 euros for business class, while flights out of the EU would be charged with 3 euros for economy class and 18 euros for business class. Different rules apply to Corsica and other overseas departments and territories of France. The exo-tax was projected to produce 180 million euros in revenue annually.
On 9 June 2020, during the COVID-19 pandemic in France, economy and finance minister Bruno Le Maire announced a financial support programme for the aerospace sector for 15 billion euros. It included the earlier announced bailout of its flag carrier Air France–KLM at 7 billion euros (comprising a state loan of 3 billion and bank loans of 4 billion), with conditions to transform it into the 'most environmentally friendly airline on the planet'. There were several aims, including the protection of 300,000 direct and indirect jobs (100,000 of which were said to be at risk within 6 months), a gradual recovery of the 34 billion annual trade surplus that the French aviation industry produced, and the goal of developing carbon-neutral air travel by 2035 rather than 2050 (for which the civil aviation research council CORAC would receive €1.5 billion in support over three years).
Germany's air passenger tax is divided in three categories, with the following taxes since 1 April 2020:
The Republic of Ireland had an Air Travel Tax from 2009 until April 2014.
On 1 July 2008, the Fourth Balkenende cabinet introduced an aviation tax (vliegbelasting or vliegtaks) of 11.25 euros per ticket for flights within Europe and 45 euros for destinations outside Europe.Due to vehement opposition by the aviation industry and travel agencies, the tax was abolished a year later on 1 July 2009, leading to heavy criticism from academia and environmental organisations. Amsterdam Airport Schiphol claimed it lost 900,000 passengers to airports abroad due to the tax, but Vrije Universiteit Amsterdam economist Eric Bartelsman pointed out that the Great Recession reduced air travel across the world, not just in the Netherlands. Tilburg University economist Lans Bovenberg was more positive, arguing aviation taxes should be implemented simultaneously across the entire EU to be effective, and that taxing jet fuel would be a more effective measure than taxing passengers.
In 2017, the Third Rutte cabinet coalition agreement planned to introduce a new aviation tax of 7 euros on every ticket, regardless of destination, on 1 January 2021.Cargo aircraft will pay a tax based on their weight and noise pollution class: up to 3.85 euros per tonne of cargo, with a lower rate for quieter aircraft. The tax, which is projected to produce an annual revenue of 200 million euros, has four goals: reducing CO2 emissions, reducing other emissions such as particulates, reducing noise pollution, and preventing a jet fuel tax. The new plan is more likely to succeed because the tax is much lower than in 2008, and most neighbouring countries except Belgium had also introduced aviation taxes in preceding years, making passengers' tax circumvention efforts unlikely. The government was aiming to eventually establish a uniform EU-wide aviation tax.
Sweden introduced a passenger tax for commercial flights of more than ten passengers in April 2018.As of 2020, Swedish aviation taxes for passengers were divided into three categories, depending on the destination:
In November 2019, the Swedish government of Stefan Löven (Löfven I Cabinet) proposed to collect an annual aviation tax of around 78 million euros.Under the proposal's conditions, the Swedish aviation industry would still be 100% exempt from the Swedish energy tax, carbon dioxide tax and sulphur tax that other companies pay.
Norway introduced airline passenger fees on 1 June 2016. From 1 June 2016 to 31 March 2020, the fee was 80 Norwegian kroner per passenger. On 1 April 2020, the fee was changed to 75 kroner for passengers with a final destination in Europe and 200 kroner for passengers with a final destination outside Europe. In addition, VAT was added to the tax.
In June 2020, the Swiss Federal Assembly approved a proposal (passed by the Council of States in 2019) to introduce an environmental levy of 30 to 120 Swiss francs per airline ticket 'depending on distance and [travel] class'; nearly half of the proceeds are to flow into a climate fund for emissions-reduction initiatives. [ non-primary source needed ] meaning there will not be aviation taxes in the very near future.[ citation needed ]The Swiss oil lobby started a campaign and a referendum against the new CO2 laws (which included the aviation tax), and in June 2021, 52% of the Swiss voters rejected them,
In the United States, most states tax avgas and jet fuel.
Some governments[ who? ] subsidize airports and passenger customs costs within airports.
The EU Commission in 2014 ruled that subsidies Ryanair received from a regional authority a decade ago had to be repaid (€525,000).
In June 2020, Flemish Economy Minister Hilde Crevits decided that trainings for airplane and helicopter pilots would no longer be subsidised in Flanders from 1 July 2020 onwards.
An airline is a company that provides air transport services for traveling passengers and freight. Airlines utilize aircraft to supply these services and may form partnerships or alliances with other airlines for codeshare agreements, in which they both offer and operate the same flight. Generally, airline companies are recognized with an air operating certificate or license issued by a governmental aviation body. Airlines may be scheduled or charter operators.
The Single European Sky (SES) is a European Commission initiative that seeks to reform the European air traffic management system through a series of actions carried out in four different levels with the aim of satisfying the needs of the European airspace in terms of capacity, safety, efficiency and environmental impact.
The International Air Transport Association is a trade association of the world's airlines founded in 1945. IATA has been described as a cartel since, in addition to setting technical standards for airlines, IATA also organized tariff conferences that served as a forum for price fixing.
Deutsche Lufthansa AG, commonly shortened to Lufthansa, is the largest German airline which, when combined with its subsidiaries, is the second-largest airline in Europe in terms of passengers carried. The name of the former flag carrier is derived from the German word Luft meaning "air" and Hansa for the Hanseatic League. Lufthansa is one of the five founding members of Star Alliance, the world's largest airline alliance, formed in 1997. The company slogan is 'Say yes to the world.'
Scandinavian Airlines, usually known as SAS, is the flag carrier of Denmark, Norway and Sweden. SAS is an abbreviation of the company's full name, Scandinavian Airlines System or legally Scandinavian Airlines System Denmark-Norway-Sweden. Part of the SAS Group and headquartered at the SAS Frösundavik Office Building in Solna, Sweden, the airline operates 180 aircraft to 90 destinations. The airline's main hub is at Copenhagen-Kastrup Airport, with connections to 109 destinations around the world. Stockholm Arlanda Airport is the second largest hub and Oslo Airport, Gardermoen being the third major hub of SAS. Minor hubs also exist at Bergen Airport, Flesland, Göteborg Landvetter Airport, Stavanger Airport, Sola, and Trondheim Airport, Værnes. SAS Cargo is an independent, wholly owned subsidiary of Scandinavian Airlines and its main office is at Copenhagen Airport.
EasyJet plc, styled as easyJet, is a British multinational low-cost airline group headquartered at London Luton Airport. It operates domestic and international scheduled services on over 1,000 routes in more than 30 countries via its affiliate airlines EasyJet UK, EasyJet Switzerland, and EasyJet Europe. EasyJet plc is listed on the London Stock Exchange and is a constituent of the FTSE 250 Index. EasyGroup Holdings Ltd is the largest shareholder with a 25.339% stake. It employs circa 14,000 people, based throughout Europe but mainly in the UK.
RyanairDAC is an Irish ultra low-cost airline founded in 1984. It is headquartered in Swords, Dublin, with its primary operational bases at Dublin and London Stansted airports. It forms the largest part of the Ryanair Holdings family of airlines, and has Ryanair UK, Buzz, and Malta Air as sister airlines. In 2016, Ryanair was the largest European budget airline by scheduled passengers flown, and carried more international passengers than any other airline.
Emission standards are the legal requirements governing air pollutants released into the atmosphere. Emission standards set quantitative limits on the permissible amount of specific air pollutants that may be released from specific sources over specific timeframes. They are generally designed to achieve air quality standards and to protect human life. Different regions and countries have different standards for vehicle emissions.
Airlines for America (A4A), formerly known as Air Transport Association of America (ATA), is an American trade association and lobbying group based in Washington, D.C. that represents major North American airlines.
Various energy conservation measures are taken in the United Kingdom.
Like other emissions resulting from fossil fuel combustion, aircraft engines produce gases, noise, and particulates, raising environmental concerns over their global impact and their local air quality effect. Jet airliners contribute to climate change by emitting carbon dioxide, the best understood greenhouse gas, and, with less scientific understanding, nitrogen oxides, contrails and particulates. Their radiative forcing is estimated at 1.3–1.4 that of CO
2 alone, excluding induced cirrus cloud with a very low level of scientific understanding. In 2018, global commercial operations generated 2.4% of all CO
Although the European Union has legislated in the area of energy policy for many years, the concept of introducing a mandatory and comprehensive European Union energy policy was only approved at the meeting of the informal European Council on 27 October 2005 at Hampton Court. The EU Treaty of Lisbon of 2007 legally includes solidarity in matters of energy supply and changes to the energy policy within the EU. Prior to the Treaty of Lisbon, EU energy legislation has been based on the EU authority in the area of the common market and environment. However, in practice many policy competencies in relation to energy remain at national member state level, and progress in policy at European level requires voluntary cooperation by members states.
The competition between Airbus and Boeing has been characterised as a duopoly in the large jet airliner market since the 1990s. This resulted from a series of mergers within the global aerospace industry, with Airbus beginning as a pan-European consortium while the American Boeing absorbed its former arch-rival, McDonnell Douglas, in 1997. Other manufacturers, such as Lockheed Martin and Convair in the United States, and British Aerospace and Fokker in Europe, were no longer able to compete and effectively withdrew from this market.
The environmental impact of aviation in the United Kingdom is increasing due to the increasing demand for air travel in the country. In the past 25 years the UK air transport industry has seen sustained growth, and the demand for passenger air travel in particular is forecast to increase more than twofold, to 465 million passengers, by 2030. Two airports; London Heathrow and London Gatwick, are amongst the top ten busiest airports in the world for international passenger traffic. Whilst more than half of all passengers travelling by air in the UK currently travel via the five London area airports, regional airports have experienced the most growth in recent years, due to the success of 'no-frills' airlines over the last decade.
An aviation biofuel or bio-jet-fuel or bio-aviation fuel (BAF) is a biofuel used to power aircraft and is said to be a sustainable aviation fuel (SAF). The International Air Transport Association (IATA) considers it to be one of the key elements to reduce the carbon footprint within the environmental impact of aviation. Aviation biofuel could help decarbonize medium- and long-haul air travel generating most emissions, and could extend the life of older aircraft types by lowering their carbon footprint.
Climate change in Sweden has received significant public and political attention. Mitigating its effects has been high on the agenda of cabinets of the Governments of Sweden from 1996 through 2021. Sweden aims for an energy supply system with zero net atmospheric greenhouse gas emissions by 2050. In 2014 and 2016, Sweden was ranked #1 in the Global Green Economy Index (GGEI), because the Swedish economy produces relatively low emissions. Sweden's winter temperature is predicted to increase by as much as 7 °C (45 °F). This will increase the percentage of precipitation that comes from rain instead of snow. The Baltic Sea could see a surface water temperature increase of up to 4 °C (39 °F). This will decrease sea ice cover by the end of the century.
The Lufthansa Group includes Lufthansa, Swiss, Austrian Airlines and Brussels Airlines. Eurowings and Lufthansa's "regional partners" are also group members. Due to the COVID-19 pandemic the company is partly state-owned as of July 2020.
The COVID-19 pandemic has had a significant impact on the aviation industry due to travel restrictions and a slump in demand among travellers.
The kerosene tax is an ecotax on the kerosene-based jet fuel in commercial aviation, which can be levied within and by the European Union. The legal basis for it is the Energy Taxation Directive (2003/96/EG) of 27 October 2003, which proves the member states with the option of introducing a tax on turbine fuel for commercial domestic flights and flights between member states.
A short-haul flight ban is a prohibition imposed by governments on airlines to establish and maintain a flight connection over a certain distance, or by organisations or companies on their employees for business travel using existing flight connections over a certain distance, in order to mitigate the environmental impact of aviation. In the 21st century, several governments, organisations and companies have imposed restrictions and even prohibitions on short-haul flights, stimulating or pressuring travellers to opt for more environmentally friendly means of transportation, especially trains.