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EC Pollution Tax Will Force Up Air Fares

Posted on: Tuesday, 27 September 2005, 18:00 CDT

AIRLINE passengers face further rises in fares, as it emerged that the European Commission is to press ahead with plans for a pollution tax, writes Robert Lea.

The plans to penalise airlines which breach targets for the emission of carbon dioxide will add around Pounds 6 per return ticket according to an impact study by the EC.

The rise comes after the recent surge in air fares with airlines slapping on fuel surcharges of as much as Pounds 60 per return ticket to offset the soaring cost of kerosene.

The European Union environment commissioner Stavros Dimas wants to push ahead with an emissions trading scheme for the aviation industry.

Emissions trading works by setting companies targets for the amount of greenhouse gases they emit. If an airline exceeds its limits it has to acquire permits from other companies.

The scheme effectively penalises inefficient users of energy or those airlines which are using older, gasguzzling fleets.

However the scheme could immediately run into problems.

The EC wants to enforce the scheme on all airlines using EU airspace, but US airlines flying the Atlantic are likely to refuse.

A scheme which hits only intra-EU operators would cause uproar among European airlines which believe they are already playing on an unlevel playing field because of the amount of state-subsidy their US rivals receive.

Source: Evening Standard; London (UK)

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