Eco Tax On Air Travel Could Generate Conflict?

July 5, 2010 / 2 Comments

The new austerity plan outlined by the German government has a proposed eco-tax to be levied on air travel. Word is that almost 1 billion euros in revenue are expected from the eco-tax move.

travel green Eco Tax On Air Travel Could Generate Conflict?
(Image by dhammza)

Countries such as Great Britain have been charging air travel duties since 2007, and it is expected that they will raise the existing duties this year. Germany seems to be following Great Britain’s lead to charge lower duties for shorter flights and fining longer flights, due to the rate of emissions they produce.

The air travel association IATA says that this move is likely to raise the price of tickets by an average of 12 to 14 euros, and may even go up to 200 euros more if the British model of duty is followed.

Detractors say that the environmental tax is not really focused on the environment, but is just another way to make additional income for the country at the expense of travelers and taxpayers.

Countries like Belgium, the Netherlands and Spain have discarded their air travel taxes, bowing to pressure from the airline lobby and also having experienced that the move was not bringing in revenue as anticipated.

The airline lobby argues that this kind of taxation is pointless since the cost of flying is already substantially lower than before, and also because modern aircraft are much more fuel efficient than their predecessors.

Currently, only Germany and Great Britain are enforcing this eco –tax. There is a strong chance that people will just continue to fly, and change their destinations to evade the eco-tax, rather than really go in for paying the tax for environmental reasons. If the environmental motive is real, the real challenge will be to convince other European countries to follow suit and to work in the price of environmental externalities into air travel.