European 'environment tax' on aviation?

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Passenger
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European 'environment tax' on aviation?

Post by Passenger » 05 Mar 2019, 08:05

On Aviation24.be's homepage, 02 March 2019:
After the Netherlands, Belgium will propose to its European Union partners to introduce a European taxation on commercial aviation, newspaper Le Soir reports this Saturday. It could be either a tax on aviation fuel, currently exempt from any tax, or a VAT on airline tickets.

The discussion will take place at the Council of Environment Ministers next Tuesday, at the request of the new Flemish Minister for the Environment Koen Van den Heuvel. In a note given to its partners, the Belgian delegation recommends “a fair and correct pricing of air transport with regard to its impact on the environment. There is currently no taxation on kerosene or VAT on tickets More environment-friendly modes of transport such as railways are more taxed than air transport.”

The European discussions will allow “the next European Commission to make adequate proposals,” hopes Walloon Environment Minister Jean-Luc Crucke. Belgium is thus part of an initiative launched by France and The Netherlands.

In any case, it will be difficult to go alone, given the competition with neighbouring countries where low-cost airlines could base their aircraft.

The decision not to tax aircraft fuel dates back to World War II. At the time, the United States wanted to do anything to develop civil aviation.

https://www.aviation24.be/airlines/alon ... ir-travel/
Le Soir:
https://www.lesoir.be/209837/article/20 ... s-en-avion

HLN.be:
https://www.hln.be/nieuws/binnenland/be ... ~a20ad962/

AD.nl:
https://www.ad.nl/politiek/kabinet-onde ... ~a5c8a624/

NRC.nl:
https://www.nrc.nl/nieuws/2018/12/07/vl ... h-a3059893
https://www.nrc.nl/nieuws/2018/12/07/vl ... t-a3059863

Passenger
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Re: European 'environment tax' on aviation?

Post by Passenger » 05 Mar 2019, 08:14

I hope our politicians won't forget to charge international shipping too - a bigger and nastier pollutor then aviation.
https://www.eea.europa.eu/articles/avia ... s-in-focus
https://www.transportenvironment.org/wh ... tion-ships
https://en.wikipedia.org/wiki/Environme ... f_shipping

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Re: European 'environment tax' on aviation?

Post by jan_olieslagers » 05 Mar 2019, 08:43

No need for an additional tax, they only need to remove exemption.
But it must be done at European level.

NB agree about shipping - I cannot compare the amount of pollution, but surely the rules should apply equally to all modes of transport - as the supporters of rail transport complain today, not without reason.

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Re: European 'environment tax' on aviation?

Post by sn26567 » 05 Mar 2019, 10:36

Rail transport should not complain. Maybe they pay VAT, but they receive massive subsidies for their infrastructure and public service obligation.
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Re: European 'environment tax' on aviation?

Post by Passenger » 05 Mar 2019, 11:11

sn26567 wrote:
05 Mar 2019, 10:36
Rail transport should not complain. Maybe they pay VAT, but they receive massive subsidies for their infrastructure and public service obligation.
On my last invoice from Belgian Rail, there was no mention of the VAT amount.

- - -

Edit: there is 6% VAT on Belgian Rail traintickets indeed, but it's already included in the tariffs.

Belgian Rail is 100% state-owned, VAT goes direct to the state and Belgian Rail gets about 90% of their revenu from state subsidies.
So actually it's not the train user who pays that 6% VAT: they only pay 10% of that VAT. The remaining 90% is paid by the tax payers, no matter if they use railways or not.

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Re: European 'environment tax' on aviation?

Post by convair » 05 Mar 2019, 13:54

jan_olieslagers wrote:
05 Mar 2019, 08:43
No need for an additional tax, they only need to remove exemption.
But it must be done at European level.

NB agree about shipping - I cannot compare the amount of pollution, but surely the rules should apply equally to all modes of transport - as the supporters of rail transport complain today, not without reason.
I fully agree, except that the rail users shouldn't complain too much as rail is largely subsidized, at least in Belgium, as explained in a post by passenger hereunder.

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Re: European 'environment tax' on aviation?

Post by Ansett » 06 Mar 2019, 18:07

From what I understand, the tax exemption for kerosene in the airline industry dates back to 1944 when the Chicago Convention was adopted, inter alia, to promote international air traffic. The Convention does not apparently mention any exemption for domestic flights.

Some say the question should be dealt with at EU level with a decision applying to all member States. Wrong.
It will give non EU airlines and hubs (mainly in the Middle East, but perhaps also Switzerland and if there is a Brexit, the UK ) a big advantage over EU airlines.

In other words, the Chicago Convention must be amended to create a level playing field for all airlines worldwide and the amended text must be ratified by the parties to the Convention. Good luck !

Imho, any national or European decision which would circumvent the Chicago Convention will only have a budgetary aim, not an environmental one. Let's not be naive.

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Re: European 'environment tax' on aviation?

Post by Ansett » 06 Mar 2019, 18:14

As to other big polluters, what about cruise ships ? Cruises are increasingly popular and cheap and I don't want to imagine how much these ships and their guests pollute !

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Re: European 'environment tax' on aviation?

Post by Passenger » 06 Mar 2019, 18:28

Ansett wrote:
06 Mar 2019, 18:07
From what I understand, the tax exemption for kerosene in the airline industry dates back to 1944 when the Chicago Convention was adopted, inter alia, to promote international air traffic. The Convention does not apparently mention any exemption for domestic flights.
Indeed. And Article 15 forbits taxes that are not related to a flight itself (use of an airport, use of an aerodrome, use of other facilities). A "pollution tax" therefore is forbitten by the Chicago Convention.

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Re: European 'environment tax' on aviation?

Post by jan_olieslagers » 06 Mar 2019, 18:45

I've said so before and I'll keep on saying: there is not a single reason for an additional tax. Anyone insisting on additional tax rulings is only seeking complication, opening more backdoors to more political clientelism. Beware of politicians, they are always seeking their own advantage first!!! A better approach is to reduce rulings and laws; for example by removing exemptions of VAT and accise tax on fuel. On all kinds of fuel, of course, for all purposes.

And if that is contrary to a convention made in 1944, it is high time to re-negotiate that one. The world has changed a lot since 1944, and is bound to change more. The Chicago convention is most important, but it is not carved in stone. (And neither is any forbiting it :) )

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Re: European 'environment tax' on aviation?

Post by sn26567 » 06 Mar 2019, 21:23

Today at the A4E Airline Summit held in Brussels, the airlines of course vehemently opposed any tax is being counter-productive and aim to reduce CO2 emissions by other means: more fuel-efficient aircraft, reduction of congestion in the sky, implementation of ICAO's CORSIA, etc.

https://www.aviation24.be/organisations ... itiatives/

https://www.aviation24.be/organisations ... anagement/
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Re: European 'environment tax' on aviation?

Post by Ansett » 07 Mar 2019, 19:23

jan_olieslagers wrote:
06 Mar 2019, 18:45

And if that is contrary to a convention made in 1944, it is high time to re-negotiate that one. The world has changed a lot since 1944, and is bound to change more. The Chicago convention is most important, but it is not carved in stone. (And neither is any forbiting it :) )
I agree with you, but easier said than done !

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Re: European 'environment tax' on aviation?

Post by Ge203 » 08 Mar 2019, 19:16

Introducing a tax on kerosene would just kill the few small airlines that are still flying, and really damage the others, just like when the price of the barrel increases! People think that airlines make hundreds thousands of profit on every single flight, but it's mostly a few thousands euros (if not even cost selling...) and that thoses taxes won't hurt them.

People also claim that the industry has to invest on low CO2 emissions aircrafts, but they just ignore - or want to ignore - the fact that newer generation of aircrafts reduce CO2 emissions by 20%.

They just want to think that they aren't responsible of the actual pollution, but the big and bad aviation industry is.

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Re: European 'environment tax' on aviation?

Post by convair » 09 Mar 2019, 16:16

Ge203 wrote:
08 Mar 2019, 19:16
Introducing a tax on kerosene ....
...the big and bad aviation industry is.
Nobody is saying ...big and bad aviation industry. No need to play victim here! The aviation industry is now priviledged thanks to the tax exemption on kerosene; that is a fact, and even the aviation fans (including me) can acknowledge that.

And if you think about it, it's not normal you can fly to, say Francfort, at cheaper price than by taking the train. We often talk here about level playing field, so...
Of course any such measure must be taken on the EU level, and provide for ways to counter any loophole attempt, like filling up outside the EU, unless it's declared to the ad hoc authorities and the corresponding tax is paid on arrival on EU territory.

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Re: European 'environment tax' on aviation?

Post by Conti764 » 09 Mar 2019, 17:29

Well, if they are really serious about leveling the playing field between plane and train, it will cost fortunes. In theory you could take a train from Brussels to let's say Madrid and an HST might reach speeds up to 250 km/h on a regular base, but in reality it's not realistic at all... Apart from many lines not adapted to those speeds, you have trains stopping at different stations, congestion on many lines,... So when in theory you might reach Madrid within 4,5 hours or so, it will still take an entire day or more still putting the train on a major disadvantage to planes... So imposing a tax on aviation wouldn't solve anything but would rather put yet another nail in some airlines coffins... And for Belgium it would mean another pile of money to be thrown away in a bottomless pitt.

Although I do agree that flying between AMS, BRU, CDG, CGN, FRA or even LHR to name a few is irresponsible and ridiculous.

Would fewer flights within Europe be an advantage to BRU? Less hub and spoke flying to different bigger hubs and more direct flying to more international destinations.

Making intra-European flight, let alone <500 km-flights less attractive or even impossible might be benificiary to SN as well since it would mean EW actually becomes more or less obsolete accept for LC long haul...

Ge203
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Re: European 'environment tax' on aviation?

Post by Ge203 » 09 Mar 2019, 19:13

I’m not against a tax on kerosene, but the whole aviation industry has been build on that exemption. It would be very hard to for the airlines to add that to their costs.
And I wasn’t playing the victim, just saying that the impact of the aviation on the environnement is relatively small compared to others, but it’s easy to attack this industry because a lot of people think it’s the most polluting, even if you confront them with numbers.
I totally agree with you on the second part. I think it’s more about making it more interesting to take the train between Brussels City and FRA/AMS/CDG/LHR with a codeshare (and of course check-in in Brussels). Nowadays, it’s cheaper, faster and stress-free to take the plane to connect those cities. That’s the problem. We’ll never be able to connect every city in Europe with an HSL.

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Re: European 'environment tax' on aviation?

Post by convair » 09 Mar 2019, 20:32

Ge203 wrote:
09 Mar 2019, 19:13
I’m not against a tax on kerosene, but the whole aviation industry has been build on that exemption. It would be very hard to for the airlines to add that to their costs.
And I wasn’t playing the victim, just saying that the impact of the aviation on the environnement is relatively small compared to others, but it’s easy to attack this industry because a lot of people think it’s the most polluting, even if you confront them with numbers.
I totally agree with you on the second part. I think it’s more about making it more interesting to take the train between Brussels City and FRA/AMS/CDG/LHR with a codeshare (and of course check-in in Brussels). Nowadays, it’s cheaper, faster and stress-free to take the plane to connect those cities. That’s the problem. We’ll never be able to connect every city in Europe with an HSL.
Glad to read were're on the same page. And exemption of the kerosene tax should be done progressively and sensibly, imho, e.g. being implemented during a period of low price fuel.

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