France increases taxes on air and road transport
From 2020 onward the French government will increase taxes on flying and road transport. Flights departing from France will see an eco-tax of 1,5 to 18 euros. The fiscal advantage for road transport will be reduced.
The flight tax will be on all flights departing from France except those to Corsica and the French departments overseas, as well as connecting flights has announced transport minister Elisabeth Borne. Incoming flights don’t have to pay this eco-tax.
“Since months there is a feeling of injustice amongst our fellow citizens about taxing air transport”, says Borne. “We already made engagements for a fair tax but now there is a sense of urgency. Like other countries we have decided to install a progressive eco-tax.”
This taxation will be applied for all airlines. “We don’t want our national airline to be disadvantaged with this measure”, added Borne. This tax has to yield 182 million euros yearly starting in 2020. “This money will be invested in more eco-friendly transport, for example trains”, concludes Borne.
Also starting in 2020 is a reduction of the fiscal advantage for road transport. The partial refund of excises on diesel for road transport will be reduced by 2 eurocent per litre. That will lead to an economy of 140 million euros for the French state. This money will be entirely spend for infrastructure.
Protests and threats
Of course the national federation of road transport (FNTR) has already vigorously protested against the new plans. They warn for manifestations and ‘other disturbances’ after vacations.
The International Air Transport Association (IATA) has also already reacted. “Those measures will put the competitiveness of the French aviation sector in danger”, IATA declared. “Such a tax will not support the efforts of the industry to invest in cleaner fuels and new technologies.”
IATA asks the French government to invest the 180 million euros of taxes in “the sustainable development of air transport, more precisely a better air traffic control and the promotion of sustainable fuels”.
Finally IATA says that this eco-tax will negatively influence the 100 billion euros contribution of aviation industry to the French economy. It will also endanger the possible 500.000 new jobs in the sector by being less competitive.
Also all other aviation related instances are angry. Air France itself (where the French state is still one of the major shareholders) says the measure will cost the company 60 million euros yearly.
Eco-taxes in the EU
Within the European Union the use of eco-taxes is very different between member states. According to Eurostat Latvia is the country with the largest contribution of eco-taxes. 11,1% of its fiscal revenues are environmental taxes. It is followed by Slovenia (10,13%) and Greece (9,5%).
The European average lies around 6% (5,97%), but many West-European countries are bad pupils: Luxembourg has the lowest impact of ‘green’ taxes (4,25%). But Germany (4,46%), Belgium (4,74%), France (4,77%) or even Sweden (4,8%) are not much better.