CMV: The European Union should institute high taxation on air travel in all member states

Fri Jul 06 2018 15:00:00 GMT+0000 (Coordinated Universal Time)

completed

University of Utrecht

Chair Ethics of Institutions

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Proposal

- taxation schemes should meet several principles, of which two are particularly relevant for the question whether air travel should be higher taxed.
- The first principle is to make sure there is no unfair advantage in competition between one firm or sector and another firm or sector. Right now, air travel companies are grossly and unfairly advantaged over firms that offer transportation via other means - trains, busses, etc, since there is no taxation on the kerosene used by flights. This makes it very hard for e.g. trains to compete with airplanes.
- The second principle is to make the polluter pay. All sorts of motorized travel cause pollution, but for the sake of the argument let me focus on the emissions of greenhouse gasses, which are a main source of climate change. Airline passengers do not pay for the damage they cause by emitting greenhouse gasses. Since everyone, independent of where they are situated on the political landscape believes that the polluter should pay, we should increase the price of transport by air (of people and goods) so as to reflect that pollution.
- However, it is extremely hard for one country within Europe to implement these measures. Their aviation industries would be hit hard, since the traffic would move to the nearby cheaper country.
- therefore, the European Union must make sure that all its member states work together to implement the same taxation scheme on air travel. This will lead to price increases in all flights arriving in or departing in Europe, and hence won’t harm the individual industries.
- the aims of this proposal are to reduce greenhouse gas emissions, create economic fairness between different transport industries. The aim is not to generate maximal tax revenue. The precise tax design should be constructed in such a way to meet those aims.

Background Information

  • Taxation on commercial aviation and the flight industry in general could come with a number of advantages for the European Union. For example, …

    • ... revenues from high taxation on commercial aviation could be used to reduce member state budget contributions  

    • … such taxation would foster sustainability by making carbon intensive air travel more costly

  • However, in the recent past several EU member states have failed to introduce proper national taxation on the aviation industry. In fact, many flight companies within the EU are even exempt from fuel taxes, VAT and legally-binding fuel efficiency requirements

  • EU Legislation, regulations and official communications in relation to aviation taxation include

    • The “Consultation on market-based measures to reduce the climate change impact from international aviation” conducted by the European Commission in 2016

    • The European Commissions “Action Plan on VAT”

    • The low emission mobility strategy

Read more

Carbon based flight tax

http://ec.europa.eu/budget/mff/Library/hlgor/selected-readings/41-Carbon-basedFlightTicketTax-Schratzenstalle.pdf

End aviation tax break

https://www.euractiv.com/section/aviation/opinion/to-help-fix-eu-budget-end-aviations-tax-break/

Debate Summary

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