IATA: Tax is Not the Answer to Aviation Sustainability

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IATA: Tax is Not the Answer to Aviation Sustainability

Reliance on taxation as the solution for cutting aviation emissions in the EU’s ‘Fit for 55’ proposal is counter-productive to the goal of sustainable aviation.

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  • Aviation is committed to decarbonization as a global industry.
  • Sustainable Aviation Fuels which reduce emissions by up to 80% compared to traditional jet fuel.
  • Aviation’s near-term vision is to provide sustainable, affordable air transport for all European citizens with SAF-powered fleets, operating with efficient air traffic management.

The International Air Transport Association (IATA) warned that the reliance on taxation as the solution for cutting aviation emissions in the EU’s ‘Fit for 55’ proposal is counter-productive to the goal of sustainable aviation. EU policy needs to support practical emission reduction measures such as incentives for Sustainable Aviation Fuels (SAF) and modernization of air traffic management. 

“Aviation is committed to decarbonization as a global industry. We don’t need persuading, or punitive measures like taxes to motivate change. In fact, taxes siphon money from the industry that could support emissions’ reducing investments in fleet renewal and clean technologies. To reduce emissions, we need governments to implement a constructive policy framework that, most immediately, focuses on production incentives for SAF and delivering the Single European Sky,” said Willie Walsh, IATA’s Director General.

Comprehensive Approach

Achieving aviation decarbonization requires a combination of measures. These include:

  • Sustainable Aviation Fuels which reduce emissions by up to 80% compared to traditional jet fuel. Insufficient supply and high prices have limited airline uptake to 120 million liters in 2021 — a small fraction of the 350 billion liters that airlines would consume in a ‘normal’ year.
  • Market-based measures to manage emissions until technology solutions are fully developed. The industry supports the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA) as a global measure for all international aviation. It avoids creating a patchwork of uncoordinated national or regional measures such as the EU Emissions Trading Scheme, that can undermine international cooperation. Overlapping schemes can lead to the same emissions being paid for more than once. IATA is extremely concerned by the Commission’s proposal that European States would no longer implement CORSIA on all international flights.
  • Single European Sky (SES) to reduce unnecessary emissions from fragmented air traffic management (ATM) and resulting inefficiencies. Modernizing European ATM through the SES initiative would cut  Europe’s aviation emissions between 6-10%, but national governments continue to delay implementation. 
  • Radical new clean technologies. While it is unlikely that electric or hydrogen propulsion could have a significant impact on aviation emissions within the EU ‘Fit for 55’ timeframe of 2030, the development of these technologies is ongoing and needs to be supported.

“Aviation’s near-term vision is to provide sustainable, affordable air transport for all European citizens with SAF-powered fleets, operating with efficient air traffic management. We should all be worried that the EU’s big idea to decarbonize aviation is making jet fuel more expensive through tax. That will not get us to where we need to be. Taxation will destroy jobs. Incentivizing SAF will improve energy independence and create sustainable jobs. The focus must be on encouraging the production of SAF, and delivering the Single European Sky,” said Walsh.  

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