A study commissioned by the European Commission in 2015 and released on Monday 13 May by the Transport & Environment (T&E) NGO concludes that further taxing the European aviation sector could significantly reduce emissions without having a major negative impact on a Member State's overall employment, tax revenues and GDP. The Commission, which has not yet published the study, has had to explain itself.
The study reviews taxes in force in the EU and notes up front that the EU taxes the air sector very little compared to other countries. It focuses principally on three types of taxation: passenger ticket taxes, VAT on tickets and kerosene taxation. Unlike many countries, such as the United States and Japan, no EU Member State taxes kerosene, for example.
However, the study shows that a European tax on kerosene would reduce CO2 emissions from aviation without negatively affecting the economy. According to the study, a kerosene tax of 33 cents per litre – the minimum rate provided for in the 2003 Energy Tax Directive – would reduce aviation CO2 emissions by 11%.
The effect on jobs in the aviation sector would also be -11%. But this significant negative impact on employment in the aviation sector would be offset by the positive impact on other sectors, the study explains. Thus, the overall impact on the labour market and GDP would be close to zero. Tax revenue would also increase from €10 billion to €27 billion.
“This report should be published immediately, as its findings justify introducing measures such as fuel tax aviation, which are currently under discussion in Europe and in the Member States”, T&E writes.
“The story that taxation of air transport endangers the economy is a fairy tale, the study shows that climate protection does not harm the economy. The European Union must no longer let the biggest climate sinners, such as aviation and shipping, get away cheaply”, said the European Green Party candidate for the European elections, Dutchman Bas Eickhout.
The T&E organization believes that the Commission did not publish this report because these were not the conclusions it expected. Asked about this topic on Monday 13 May, Commission spokesman Margaritis Schinas confirmed that the institution was preparing, at the technical level, “contributions” for the new political and legislative cycle, adding: “a report does not replace politics”.
The Commission has launched a wider reflection process on the current rules on energy taxation, said another Commission spokesperson, Vanessa Mock. “The evaluation is ongoing, we are finalizing it right now”, she said.
See the report: https://bit.ly/2YnRLAn. (Original version in French by Marion Fontana)