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Press Release No.: 38

Date: 16 July 2008

Taxes Don’t Reduce Emissions

Farnborough, UK - The International Air Transport Association (IATA) called on governments to abandon punitive environment taxes and instead support global environment solutions that will actually reduce aviation’s 2% of global carbon emissions.

“Taxes don’t reduce emissions. Only better operations and technology can do that,” said Giovanni Bisignani, IATA’s Director General and CEO, addressing the Farnborough International 2008 Sustainable Aviation Briefing.

“The airline industry is in crisis. With a fuel bill of US$190 billion - one third of its costs - saving fuel is a matter of survival. Still Europe is fixated on punitive measures supposedly designed to reduce emissions. There is a rush to implement taxes, taxes and more taxes. They all have an environment label, but do nothing to reduce emissions,” said Bisignani. He took aim at two punitive measures in particular:

UK Air Passenger Duty (APD): “By 2010 APD could be a GBP3.5 billion pot of honey for the UK Treasury. That’s enough to offset four years of the UK’s civil aviation emissions. The UK proposal will lead to market distortions. And governments - including the UK - are double counting. On top of APD, other countries such as the Netherlands also apply taxes. If this weren’t enough, the European Union emissions trading proposal will add another layer of penalties. What will all this do for the environment? Precious little. It’s time for some political honesty about where the billions are going and what they will achieve,” said Bisignani.

European Union Emissions Trading Scheme (ETS): “We support emissions trading, but Europe’s unilateral approach is wrong. Instead of cleaning up the environment, this will create an international legal mess. States outside Europe are already threatening legal action. Why should a US carrier have to pay Europe for emissions over US territory? Going global is the only way to success.  The drafters of the Kyoto Protocol understood this and tasked the International Civil Aviation Organization (ICAO) to deal with aviation and the environment. But this wisdom did not make it to the European Parliament. Even as France, Germany, Italy, the UK and the EU signed a G8 declaration reconfirming ICAO’s role in delivering a global solution, the European Parliament moved in the opposite direction by voting for a regional ETS. Good sense has been hijacked by uncoordinated green policies,” said Bisignani.

“States - including Europe - will make or break the ICAO process. ICAO strengthened its political leadership on the issue with a high level Group on International Aviation and Climate Change (GIACC). Europe, which can take the credit for placing climate change on the international aviation agenda, must now take responsibility to ensure that ICAO is successful,” said Bisignani.

IATA’s four-pillar strategy to address climate change focuses on technology investment, effective operations, efficient infrastructure and positive economic measures. This is now an industry commitment supported by airlines, manufacturers, airports, air navigation service providers and industry partners. “Now governments must play their role responsibly by taking the reality of US$140 oil into account, stopping their green grand-standing, and joining the industry’s global and comprehensive approach,” said Bisignani.

View full speech

Notes for editors:

  • IATA (International Air Transport Association) represents some 230 airlines comprising 93% of scheduled international air traffic

For more information please contact:
Corporate Communications         
Tel: +41 22 770 2967                      
Email: corpcomms@iata.org

 

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