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Commission’s ‘Fit for 55’ climate package proposes removing European aviation’s fuel tax exemption

19/07/2021



The EU’s ‘Fit for 55’ legislative package of proposals unveiled by European Commission President Ursula von der Leyen is likely to have long-term consequences for the aviation sector. Parts of the package have already been widely flagged, such as the introduction of an incremental blending mandate for sustainable aviation fuels and tightening of EU Emissions Trading System (EU ETS) provisions for intra-European flights. However, a proposal to remove the tax exemption on aviation fuel could have a major impact on the sector. The Commission is proposing a kerosene tax based on energy content be introduced linearly over a transitional period of 10 years from 2023, corresponding to minimum tax rates applicable to road transport fuels. Because of existing agreements with countries like the United States, the tax would not be applied to cargo-only intra-EU flights and a zero rate would be applied to aviation advanced biofuels and e-fuels for a limited period to allow production scale up. Airline industry body IATA said a reliance on taxation to cut Europe’s aviation emissions would be counter-productive to the goal of sustainable aviation. [...]

GreenAir Online

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