Oil report

Nine EU countries call for a European aviation tax to curb emissions

BRUSSELS, Nov 7 (Reuters) - Nine European Union states have called on the bloc’s incoming Commission to introduce a EU-wide tax on aviation, in order to charge a polluting industry more for its emissions and to put all member states on level pegging.

In a letter to the bloc’s new climate official, Frans Timmermans, the finance ministers of Germany, France, the Netherlands, Sweden and five other EU states, called for “some form of aviation tax” without giving specifics.

The nine countries said an aviation tax where “the polluter pays a fairer price for the use of aviation transport” is necessary to combat climate change. Transportation is the only European sector currently increasing its emissions.

“Compared to most other means of transportation, aviation is not sufficiently priced,” the letter said, and recounted all the perks currently enjoyed by the sector, including exceptions from excise duties and the fact that no VAT is levied on international flights.

Higher taxes on polluting industries have been hotly debated among EU states as the EU requires unanimity when deciding on policy, such as taxation.

Ambitious targets for reducing carbon emissions by at least 50% by 2030 are part of the agenda of the new European Commission.

In July, France announced a tax on airlines flying from its airports to help support the environment, a move that Air France said would significantly hurt its competitiveness and add over 60 million euros in additional costs per year.

One of the signatories of the letter, Sweden, introduced an aviation tax on its own in 2018 and another, the Netherlands, is planning to introduce one in 2020 unless an EU agreement is reached before then.

“By taking action now, we hope this important issue will take off in Europe too,” Menno Snel, the Netherlands’ finance minister said in a statement on Thursday. (Reporting by Jonas Ekblom Editing by Alexandra Hudson)