The green kerosene taxes being imposed on aviation fuel discriminate against short and medium haul carriers to the benefit of the giants

In his intervention at a FISC subcommitee meeting on the upcoming Energy Treaty Directive, Alfred Sant emphasized that the revised proposals will put large airlines at an advantage over smaller ones because long haul flights will be exempted from tax emissions despite producing the bulk of emissions. Sant also asked if in setting these taxes, sufficient account has been taken as to whether peripheral countries, islands and remote regions where tourism is the primary vehicle for economic development will be negatively affected, increasing further their lack of connectivity.

The former Maltese Prime Minister took the floor in the subcomittee on tax matters (FISC) in the European Parliament of which he is an S&D member.

Energy taxation is a budgetary instrument used by European governments to generate money and support climate objectives. The Energy Taxation Directive lays minimum taxation levels to make sure that the European Single Market functions thoroughly and is used to assist other policies. In July 2021, as part of the “Fit for 55” legislative package, the European Commission called for a revision of the Energy Taxation Directive and proposed a new legislation that would tax processes which create greater climate warming.

The Labour MEP emphasized that taxing kerosene fuel used in medium haul flights while exempting long haul flights amounts to a cross subsidisation in fuel emission taxation. This will benefit large carriers at the expense of smaller airlines.

Sant stressed that the proposed changes in the emissions taxation will not strike the right balance because these could likely serve to cut off remote or peripheral communities.