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UK Passenger Tax ‘Will weaken airline enthusiasme for emissions trading’, says AEA

AEA Press Release 14.12.2006 Pr06-55


The UK Chancellor’s announcement that the British Air Passenger Duty is to be doubled – up to a massive £80 (€118.30) for longhaul business trips – has sent tremors through an airline sector facing the prospect of inclusion in a European Emissions Trading Scheme (ETS).

The Air Passenger Duty increase has, if the UK Government is to be believed, an environmental objective, by modifying demand for air transport – a euphemism for pricing passengers out of the market. This is precisely what the airlines believe a well-designed ETS could avoid, while still delivering environmental benefits.

Said AEA Secretary General Ulrich Schulte-Strathaus: “The increase in Passenger Duty is one more example – like the French tax-for-aid scheme introduced this summer – of the aviation sector being treated as a cash cow. This UK tax is a budgetary measure, pure and simple; it is designed to deliver additional revenue of about €1.4 billion annually, revenue which will not be used for environmental objectives, but simply to underwrite general government spending”.

“This move will provide no incentive whatsoever for airlines to invest in more efficient aircraft, or more efficient fuels. Indeed, by attacking their customer base, it will make it more difficult for them to fund the new technologies that provide the best prospects for future emissions abatement”.

European airlines have consistently adopted a responsible approach to addressing the environmental challenges facing the industry. AEA airlines have established an Emissions Containment Policy which promotes best practice in operational procedures, stimulates research into new technologies and supports infrastructure improvements. ETS is seen as a means to harness these improvements in delivering a genuine contribution from the industry towards meeting overall EU emissions targets.

Said Mr Schulte-Strathaus: “An ETS, if it is designed appropriately, is a precision tool whereby airlines can manage their emissions. A tax such as the APD, inasmuch as it serves any environmental purpose whatsoever, is a blunt instrument, a crude attempt to manipulate the market. Airlines’ enthusiasm for ETS is bound to be weakened by such fragmented and opportunistic actions. If people want to keep flying, we need effective measures at global or European level”.

For further information, please contact:
Françoise Humbert
General Manager Communications
Phone: +32(0) 2 639 89 93
Email: francoise.humbert@aea.be

Note to the Editor: The Association of European Airlines (AEA) brings together 31 European established service and scheduled network carriers. These collectively carry 320 million passengers and 6 million tons of cargo each year, operating 2,400 aircraft serving 620 destinations in 160 countries with 10,720 flights a day. They provide around 378,000 jobs directly, and generate a total turnover of €75 billion.

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