The European Union’s plan to impose a carbon tax on flights in and out of the region has drawn criticism from around the world, but Chinese airlines have now become the first to flat-out refuse to pay the tax.
Part of the European Union’s emission trading scheme (ETS), the tariff went into effect at the start of the year and is tallied based on the entire route of a flight, not just the portion that uses European air space. Uncooperative airlines could face fines of 100 euros per ton of emissions, and eventually be banned from European airports.
“China will not cooperate with the European Union on the ETS, so Chinese airlines will not impose surcharges on customers relating to the emissions tax,” said Cai Haibo, deputy secretary-general of the China Air Transport Association (CATA), according to Reuters.
China is far from alone in its opposition to the new tax. The Air Transport Association, along with three U.S. carriers, filed suit in Europe last year to have the tax blocked, arguing that the International Civil Aviation Organization (ICAO), a UN agency, is the appropriate body to impose such a tax. Legislation has been introduced in Congress that would formalize U.S. opposition. India’s civil aviation ministry has reportedly told airlines not to submit the data that the EU requires under the ETS. And Australia’s Qantas Airlines has threatened a lawsuit.
Although airlines would not actually pay until March of 2013, the ETS began affecting flights January 1, so passengers could begin to see fare increases soon.
Estimates differ on how much the tax will cost airlines, and how much airlines would pass on to passengers. The European Commission puts the cost at two to 12 euros (about $2.50 to $15) per passenger per flight, but aviation analysts have come up with other figures. One told Dubai’s Gulf News that he believed the cost would come to $20 to $30 per trip, just for short hauls within Europe. A spokesperson for Cathay Pacific told Reuters that the ETS would add about $6.44 to a ticket from Hong Kong to Europe. And Tony Tyler, director general of the International Air Transport Association (IATA), estimates the ETS’ cost to airlines in 2012 will reach 1.2 billion euros ($1.53 billion).
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