EU will lose €13.3 billion in 2025 due to jet fuel tax exemption
- The EU is currently discussing a 20-year prolongation of jet fuel tax exemption, proposed by the Orban EU presidency.
- By the time the tax would come into effect, the world is supposed to have almost reached climate neutrality.
- Reason given is the absence of alternatives to fossil fuels, which civil society argues to actually be a reason for taxing fossil jet fuel.
October 9th 2024 – Airport residents groups and environmental organisations oppose the EU’s plans to exempt planes from fuel tax for 20 years. An open letter addressed to EU tax affairs representatives urges them not to side with Orban’s proposal and instead end the unfair subsidies of air traffic now.
“Currently, a parent bringing their kids to school by car pays more fuel tax than a celebrity flying weekly to their luxury villa. Also farmers producing our food pay more for the tractor fuel than airlines do. This is not only unjust, but also economically illiterate”, says the letter by Stay Grounded, representing 200 organisations, UECNA representing 30 European airport communities, Germanwatch, New Economics Foundation and further NGOs.
It is projected that in 2025, indirect subsidies for aviation will lead to a loss of EU revenues totalling €35.7 billion, of which €13.3 billion is due to the tax exemption of kerosene. By the time the tax would be in effect, the world is supposed to have almost reached climate neutrality. The end of the jet fuel tax exemption was part of the Fit for 55 Package released by the EU Commission in 2021.
Magdalena Heuwieser from Stay Grounded said: “This insane idea to prolong the jet fuel tax exemption again should create a public outcry! We just suffered wildfires in Portugal, floods in Austria, thunderstorms in Italy – and the most climate damaging and elitist form of transport remains tax free!”
The Orban presidency’s argument for prolonging the fuel tax exemption is “the absence of more efficient alternatives, sufficient quantity of sustainable alternative fuels and electricity”.
Campaigners and airport groups argue this is absurd: “This absence should be the main reason to finally implement demand reduction measures. Decoupling aviation from its emissions is at best a distant scenario – especially as long as fossil kerosene is subsidised through a tax exemption.” Therefore, they say, air traffic needs to be reduced in line with the remaining carbon budget.
Magdalena Heuwieser from Stay Grounded said: “It is not fair to leave this sector out of climate commitments, while heating and eating become more expensive, especially because aviation is an industry largely at the service of the privileged. Approximately 1% of the world population produces half of aviation emissions, while most people have never set foot on an aeroplane. Concerns about the impact of a kerosene tax on the equity of access to occasional air travel by lower income households can be addressed through additional targeted measures like a frequent flying levy and through redistribution of tax revenues.”
Prolonging the exemption means rewarding the industry for continuously missing its climate targets. We must instead choose common sense by ending the aviation industry’s ludicrous subsidies
Press Contact:
Magdalena Heuwieser
press@stay-grounded.org
+436703534311
