Europe proposes a fuel tax on aviation industry to push green energy

Aviation can no longer fly under the radar using polluting jet fuel with proposed tax levy in EU

The European Commission has drafted plans to set an EU-wide minimum tax rate for polluting aviation fuels. This comes as the EU comes under increasing pressure to set more ambitious climate targets.

The aviation industry is currently exempt from fuel taxation charges in the EU. However, the European Commission has found this exemption “is not coherent with the present climate challenges and policies”.

The minimum tax rate would come into effect in 2023, increasing gradually over a 10-year period. Reuters reports that the draft document didn’t specify the final tax rate.

How difficult would it be to introduce the proposal?

Changes to EU tax rates require unanimous support from 27 countries, so passing the bill could be potentially difficult. If one state doesn’t agree, the whole proposal cannot pass.

The taxes wouldn’t be imposed on sustainable fuels, such as renewable hydrogen, e-kerosene and biofuels. The tax would be based on how polluting the energy source is.

Uptake of green fuels has been hampered by high costs. Sustainable aircraft fuel makes up less than 1% of Europe’s jet fuel consumption.