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This house would tax aviation fuel.
This house would tax aviation fuel.
The debate over whether international aviation should be taxed brings together two global problems: how to control emissions that cause climate change; and how to find additional funding for development aid, for example to help meet the Millennium Development Goals. Aircraft contribute to climate change by releasing CO2, other greenhouse gases, and also particulates (very small particles, e.g. of soot). Aviation is now estimated to produce 3% of all global CO2 emissions, but this is rising fast with the increasing affordability of flights for hundreds of millions of people worldwide1. It is estimated that air travel will produce 15% of all CO2 emissions by 20502. The problem is made worse by studies that suggest aviation is much more damaging to the climate than its level of CO2 output indicates, because the other gases it emits are even more damaging, and because the high altitudes at which these gases are emitted increases their impact. At present, aviation is largely exempt from fuel taxes, although a few countries (including America and Japan) levy a tax on fuel used only on domestic flights. Green groups have long argued that aviation should pay for the costs of the pollution it causes. In the Kyoto Protocol, the International Civil Aviation Organization (ICAO) was charged with researching the ways in which this could be done, but no actual measures have yet been taken. Since 2000, the European Union has increasingly discussed taking action, both unilaterally and by lobbying in international forums. The United States and Australia are particularly opposed to a global tax on aviation, but other states have been more supportive.
|Points For||Points Against|
|Taxing aviation fuel would reduce emissions.||A tax on aviation fuel would reduce air travel for ordinary families.|
|An tax on aviation could be adopted first by regional blocks||Introducing an aviation tax would do economic damage to the travel industry.|
|Introducing an aviation tax would increase fuel efficiency.||Market-based solutions are more effective than aviation tax.|
|Aviation taxation will generate money for development aid.|
Remember to choose a winning argument!
Taxing aviation fuel would reduce emissions.
Flying is a major source of pollution and, in particular, of greenhouse gases such as carbon dioxide and nitrous oxide. The role of aircraft in climate change is worsened by the high altitude at which gases and particulates are released into the atmosphere. It is thought that the impact of aircraft emissions on our climate is two or three times greater than that of the same amount of CO2 when released by vehicles on the ground1. At present, aviation fuel is largely free from taxation. Most countries do not tax it for internal journeys, and international treaties prevent taxation of fuel used for international flights. For these reasons, aviation fuel (kerosene, a fossil fuel) should be taxed, in order to make the polluter pay for the damage they cause, and to encourage a reduction in the amount of emissions.Improve this
The aviation industry recognizes the impact of aircraft emissions on the climate, although the extent of the damage compared to other uses of fossil fuels is still uncertain. Led by the International Civil Aviation Organization (ICAO), the industry is making considerable progress towards reducing emissions. Engines are becoming more efficient and so are flight procedures, allowing fuel to be used more efficiently. ICAO pollution standards have been progressively tightened for a range of different emissions. As a result, emissions per passenger kilometer have been reduced by 70% over the past forty years. Research suggests that CO2 production can be halved by 2020 as airlines update their fleets of aircraft and technology continues to improve1. Given this voluntary progress and the continuing efforts of airlines and aerospace companies, taxation is unnecessary.Improve this
An tax on aviation could be adopted first by regional blocks
A tax on aviation fuel could certainly be put into effect on an international basis. Climate change is a global problem and the ICAO was tasked in the Kyoto Protocol to look at how the aviation industry worldwide could reduce emissions. As it is in the interests of all countries to tackle aircraft emissions, an international consensus could certainly be achieved given effort. Agreements on other difficult issues have been reached in the past (e.g. the Millennium Development Goals, anti-landmine treaties, the Montreal climate change conference in 2005).
Even before international agreement is reached, groups of states could still adopt such a tax effectively. For example, EU states could apply a fuel tax to EU airlines on European flights, and extend it to non-EU airlines in Europe by renegotiating Air Service Agreements with other states. Levels of tax can be set low enough to avoid distorting travellers' choices about where they fly. Europe is already alone attempting to impose its emissions trading scheme on all flights to European Airports showing that countries do have the will to force the airlines to compensate for their emissions, an international tax bringing in other countries would potentially be much more effective and not be seen as a unilateral move so not create protests from around the world as the ETS has1.Improve this
A tax on aviation fuel would be impractical and impossible to put into action. Attempts to place a tax on fuel by individual states will fail, as airlines can easily obtain fuel more cheaply elsewhere. And if individual countries raise the cost of flying to and from their airports, they will lose income from tourists and business travellers to other states. Trying to put a global tax in place will also fail - international treaties actually make it illegal to tax aviation fuel (the 1944 Chicago Convention1, reinforced by many bilateral Air Service Agreements) and there is no international consensus for change.Improve this
Introducing an aviation tax would increase fuel efficiency.
Taxing aviation fuel would encourage greater fuel economy by making kerosene more expensive. As the popularity of air travel continues to increase rapidly, it is important to put pressure on the aviation industry to use fuel as efficiently as possible, in order to hold emissions down as much as much as they are able to. With fossil fuel reserves running out, fuel conservation is also a wise use of finite resources. More expensive fuel would give airlines an incentive to adopt the most modern technology and update their fleets. They could also adopt flying practices aimed at maximizing fuel efficiency, such as flying at lower speeds.Improve this
Airlines already have a price incentive to maximize fuel efficiency, so a tax on fuel is unnecessary. Fuel is a major cost item for all airlines and, as the price of fossil fuels has soared over the past few years, extra pressures have been put on airlines to change their practices and adopt new technology in order to survive. Both Boeing and Airbus have responded to this market demand by producing new aircraft with much lower emissions per passenger, and airlines are already ordering them in large numbers1. Compared to the large market swings in price for aviation fuel, a tax would have little additional impact.Improve this
Aviation taxation will generate money for development aid.
A tax on aviation would be international in scale and provide an excellent opportunity to raise money for development aid. The European Union is considering such a plan in order to provide additional funding to ensure its Millennium Development Goals targets will be met. France, Germany, Brazil and Chile are already calling for such an initiative, and France already unilaterally introduced a levy on flights in 2006 to go to meeting the MDGs1. In the long term, a global tax on aviation could be administered by the United Nations, providing it with a regular, predictable income safe from political interference. Greater UN control over development aid will also overcome current problems of duplication, favoritism and waste in competing national programs. Setting revenues from aviation aside to fund international aid will make a tax more acceptable to passengers, and will spread the burden of aid funding more fairly around the world.Improve this
Unless a tax on aviation was so high that it damaged the airline industry, it is unlikely to meet the need for development aid. Countries have already made commitments to fund the Millennium Development Goals (MDGs) and they should be prepared to meet their promises out of their domestic budgets, rather than experiment with an untested gimmick. There is a danger that if politicians and voters feel international aid has its own tax, they will stop funding it from regular taxation. There are also serious questions about accountability and administration - national aid budgets are already much more likely to be well run than the programs of undemocratic international institutions such as the UN and the EU. Finally, hypothecation of revenues (money raised by a particular tax spent on only one thing) is in itself harmful. There is no reason to think that the need for development aid will go up or down with the economic fortunes of the airline industry. If another terrorist attack like 9/11 took place (or there was an international disease outbreak such as SARS or Avian flu), aviation could be badly hit once more. With such a tax, fewer flights would mean less money generated towards development aid.Improve this
A tax on aviation fuel would reduce air travel for ordinary families.
Cheaper air travel has been of great benefit to hundreds of millions of people. Huge numbers who had never been able to travel beyond their home country are now able to explore the world, and enjoy the holidays which used to be a privilege of the wealthy. Those who wish to end budget air travel are partly motivated by snobbery, but cheap fares have a wider political and social benefit. By opening people's minds to other cultures they create more understanding and tolerance in the world. Cheap fares particularly provide this opportunity for greater understanding among lower income passengers, who would not otherwise be able to fly. They also aid development in previously remote areas, as tourism creates new sources of income for the people there. At the same time, ease of movement has freed up the global labor market and increased productivity in the developed world. We should do nothing to raise the cost of flying and check such a positive trend.Improve this
A tax on aviation fuel would be progressive and fair, as the very poorest are already unable to afford air fares. Faced with higher costs, airlines will pass these on to their customers in the form of higher ticket prices. Even among those who can afford air travel, the rich consume many more flights than the less well off, so a rough equity would be achieved. Big business would also have to pay for much of the increased cost. In any case, the sums involved are unlikely to prevent anyone flying off on an annual holiday, as even a 10% rise in air fares would be less than 5% of the total cost (including hotels, trips, and meals) of the whole experience1.Improve this
Introducing an aviation tax would do economic damage to the travel industry.
Yes, a tax would reduce air travel, but this would cause far more harm than good. Taxing aviation fuel would have a dangerous economic impact on airlines. Airline companies have very high fixed costs, including: hugely expensive fleets of aircraft, large and well-paid staff, and landing fees. Therefore, their finances are very precarious. The big airlines in America are already struggling to survive and, in recent years, a number of European companies have either become bankrupt or have been forced to merge. Even if the level of taxation was initially very low, a small impact on passenger numbers, with some people put off travelling by slightly higher prices, could tip some airlines over the edge. When airlines go bankrupt, thousands of people are put out of work and many more are greatly inconvenienced as their holiday or business plans have to be cancelled. The tourism industry, which generates an estimated £115bn per year into the UK alone, will also suffer if people cannot afford to travel1. That is far too large of a cost to pay for solving very small problems, like loud noise near airports.
Air travel causes other negative impacts on the environment, beyond its contribution to climate change. The rapid increase in flights over the past two decades has led to increased local air pollution, noise pollution, traffic congestion (and vehicle emissions) around airports, and the loss of land to new runways and terminal buildings. The rise of budget airlines offering very cheap fares for short-haul trips is one of the main culprits of these problems. These budget airlines particularly contribute to greenhouse gas emissions as lots of short-haul flights are especially environmentally unfriendly (emissions are most heavily discharged on take-off and landing). A tax on aviation fuel would bring an end to ultra-cheap flights as increased costs will be reflected in higher ticket prices. This would reduce the runaway growth in air travel, and all the problems associated with it.Improve this
Market-based solutions are more effective than aviation tax.
An alternative way of controlling aviation emissions would be to introduce a "cap and trade" system. This is the ICAO's preferred option for addressing climate change and would involve airlines being issued with a "permit to pollute" set at a certain level. If they wish to emit more greenhouse gases than the permit allows– for instance, because they wish to put on more flights – then they have to buy spare pollution credits on an open market. Sellers could include other airlines, which have reduced their number of flights or invested in more environmentally-friendly airplanes, and also companies in other industries with spare capacity. Such a system is encouraged under international climate treaties and would fit in with existing EU initiatives for industry. Cap and trade is a market-based solution which captures the environmental externalities (costs) of flight and internalizes those externalities (makes the airlines pay for them). Over time, reducing the overall amount of greenhouse gas emissions permitted under cap and trade could increase the incentives for aviation companies to invest in cleaner technology and, ultimately, change their business practices.Improve this
Emissions trading has many problems. Unlike other solutions, it does not raise any revenue for development aid - one of the main advantages of a global aviation tax. Even on its own terms, emissions trading is flawed; the fact that the aviation industry prefers it to a tax on fuel suggests it will have little impact. Cap and trade can sound effective in principle but is very hard to make work correctly or fairly. It is unclear, for example, who decides what levels the permits should be set at; too high and permits make no difference to emissions, too low and the airline industry is bankrupted. The system also favors large existing airlines, which are often very inefficient, over new or growing ones. It is also unclear how such a system would be policed. The EU has been trying to put a cap and trade system in place but cannot secure the cooperation of other countries, particularly the USA, in order to make it work.Improve this
Bishop, Simon. "The Sky's the Limit: Policies for Sustainable Aviation." Institute for Public Policy Research. 21/05/2003.
Upham, Paul (ed). "Towards Sustainable Aviation." Earthscan. 29/04/2003.
Department for Transport. "Aviation and the Environment: Using Economic Instruments." Department for Transport. 14/03/2004.
Immelmann, Thomas (ed). "Aviation Versus Environment?" Peter Lang. 21/02/2000.
OECD. "Low-Emission Vehicles: Strategies for the Implementation of Clean and Fuel-Efficient Vehicles." Organisation for Economic Co-Operation & Development. 03/2004.
Gossling, Stefan. "Climate Change and Aviation: Issues, Challenges and Solutions." EarthScan. 25/02/2009.
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