A tax on kerosene for aircraft in the European Union can be a significant improvement for the environment, while it will have little effect on the economy as a whole. This is stated in a leaked study that the European Commission has commissioned, but has not yet published.
The report, leaked by the European interest organization Transport & Environment, calculates what would happen if 33 cents tax per liter of kerosene were charged. That amount has not gone unnoticed: it is the rate that European countries already agreed with each other in 2003 as a minimum tax on kerosene; aviation was at the same time largely exempt from the tax (on some domestic flights there is a tax on kerosene).
If that exemption disappears, the airlines will pass on the higher costs in airline ticket prices. On average, they will then be around 10 percent more expensive.
This would result in fewer people traveling by plane: the number of passengers fell by 9 to 11 percent. As a result, CO2 emissions and noise pollution would also fall by 9 to 11 percent, the researchers estimate.
Not bad for the economy
All in all, the tax will not make much difference for the economy. Jobs will disappear in aviation, but work will be added in other sectors. The tax that governments collect as a result of the tax will either be used to invest more or to lower other taxes.
In the report, researchers also looked at other forms of flight tax. For example, countries could choose to levy the standard VAT rate on airline tickets, or to introduce a separate tax on airline tickets.
The latter is already happening in Germany, for example, and will also be introduced in the Netherlands in 2021. Tickets from the Netherlands will then be 7 euros more expensive.
Because the VAT rates and possible ticket taxes can vary greatly per country, the researchers did not pass on the effects of this at European level. Estimates have been made per country.
Estimates of securities in the Netherlands
According to these calculations, all three types of taxation in the Netherlands would have a positive effect on the environment and would not significantly harm the economy as a whole. The introduction of the 21 percent VAT rate will lead to a 21 percent drop in passengers and a correspondingly fall in CO2 emissions. The kerosene tax leads to reductions of around 19 percent and the ticket tax for decreases of 4 percent.
This calculation does not take into account individual agreements that apply to Schiphol. The Dutch government has limited the number of flight movements at the airport to 500,000 per year, while the demand is higher.
If, for example, budget holidaymakers start to fly less because tickets become more expensive to the left or to the right, then aviation experts expect that gap to be filled in another way. For example, more international passengers will transfer at Schiphol.
That would mean that a tax at European level might, but at Dutch level, have no effect on the amount of CO2 emissions.