Tax aviation fuel and rake in €500 million, says Zero’s president

The president of Zero – Portugal’s ‘Sustainable Earth System Association,’  – says that “aviation emissions increased 7% in Portugal in the last year,” but that the country is missing out on the tax-take on fuels and that other EU nations are raking in.

Based on a study prepared for the European Commission in 2018, which shows that aviation in the Member States of the European Union is more tax-free than in other markets, Francisco Ferreira defended the application of taxes on fuel used in Portugal.

According to the study, if Portugal were to tax aviation fuel, “it could reduce air traffic and emissions by 11% and this would reduce the noise-affected population in Portugal by 6% and provide almost €500 million euros without affecting employment or GDP,” claimed Ferreira.

“In other words, if the aviation sector suffered from a decrease in demand, the government, by reinjecting €500 million into the economy, would provide the same number of jobs or even higher and an increase in wealth sufficient to compensate for a reduction in aviation,” said Francisco Ferreira.

This annual tax revenue would be achieved with a special tax on fuel used on all flights from Portuguese airports. This would be €0.33 per litre, which is the minimum rate imposed by the European Directive 2003 on the taxation of energy products.

The president of the environmental association stressed that it would be “an opportunity to reduce the costs that air transport has in terms of greenhouse gas emissions and consequently climate change and the effects on human health with regard to air pollution and to noise.”

“For the country, the reduction of emissions by 11% would be equivalent to a demand reduction equal to taking 200,000 cars a year from the Portuguese roads,” said Ferreira.

Recalling that the National Energy and Climate Plan and the Roadmap for Carbon Neutrality for 2050 both are under discussion, “it is crucial that Portugal, as it is at the forefront of renewable energies and meets these long-term climate objectives, also involving the aviation industry.”

“We can not look at the data that show the huge increase in emissions and announce more than the doubling of passengers at airports like Lisbon, with very significant climate implications, while losing the possibility of generating tax revenues,” said the president of Zero.

Through the proposal of a fiscal policy for aviation, the environmental association believes that it is possible to effectively correct over the next few years a sector that must be more balanced, in order to make Portugal coherent in environmental and climate change policy.”