Calls Grow to Tax Airlines for Pollution | Business| Economy and finance news from a German perspective | DW | 31.12.2004
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Calls Grow to Tax Airlines for Pollution

In Germany, airlines enjoy generous government tax breaks while rail companies pay environmental and fuel taxes, even though they pollute less. The paradox has environmentalists and rail officials upset.


Planes pollute more than trains, but pay less environmental tax

Germany's large environmental organizations as well as Deutsche Bahn, the country's national rail operator, are demanding the rail network get the same treatment airlines do.

The country's airlines are currently not subject to any environmental and fuel tax and in the case of flights abroad, no value-added tax either. Deutsche Bahn, on the other hand, is required by law to pay all three. It then passes the costs on to passengers.

Deutsche Bahn complains that the tax imbalance distorts competition, and environmentalists say the tax breaks for airlines amount to subsidizing a mode of transport that releases large amounts of pollutants.

Airlines - worst climate polluters

Flugzeug mit Kondensstreifen

The burning of jet-engine fuel results in environmentally damaging emissions that predominantly consist of vapor, carbon dioxide and nitrogen oxides.

The effects of these substances are three times more pronounced at a higher altitude than they are on the ground, a fact that environmentalists say further exacerbates the "greenhouse effect," wherein the trapped gases prevent heat being released from earth's atmosphere and heat up the planet.

Gerhard Timm, head of the German environmental organization BUND (the Association for Environment and Nature Protection), said that the International Panel on Climate Change (IPCC) had already concluded that CO2 emissions released high up in the air were up to eight times more harmful than when released near the ground.

Culprit: discount airlines

"The other problem is that air traffic in Europe is one of the fastest growing in the world and increasing in the double digits every year," Timm said.

The United Nations Intergovernmental Panel on Climate Change estimates that aviation already causes four percent of man-made global warming and that figure could rise to 15 percent by 2050. According to the OECD, the impact of air traffic on global climate warming in 2030 will be more than three times higher than in 1990. The German Environment Ministry expects a threefold jump in CO2 emissions by German airplanes by 2030.

Ryanair Flugzeug in Brüssel

Passengers step off of a Ryanair flight at Brussels

The environment lobby has already identified the main culprit responsible for the alarming rise in greenhouse gases: discount airlines.

Air travel has increased five fold since 1970, with much of that growth taking place in the last few years due to the exploding popularity of budget airlines. Germany's green lobby has little doubt that the no-frills travel boom is the country's number one climate killer.

EU moves to check imbalance

In the face of such violations, environmentalists and Deutsche Bahn representatives are pushing for environmental taxes to be imposed on airlines.

Die Deutsche Bahn am Rhein

They point out that that a rail journey is about a tenth as damaging to the environment as a airplane flight. BUND has calculated that the three tax breaks enjoyed by airlines costs the German finance ministry more than €5 billion ($6.8 billion) a year.

The European Union has attempted to correct the imbalance. Since the beginning of 2004, a new EU energy tax directive explicitly mentions imposing a fuel tax on domestic flights as well as on planes operating within EU air space provided the participating EU member states reach agreement on it.

But, unanimous agreement on the directive is still forthcoming. "The EU regulation actually makes it possible for us in Germany to make a unilateral move towards such a fuel tax on airlines," Timm said. "The Greens, the junior coalition partner in the governing coalition are in favor of it, but the bigger partner still has doubts," he added, referring to the Social Democrats.

Pay back taxes or punish airlines

BUND has now kicked off a nationwide campaign together with Deutsche Bahn to demand a fuel tax on domestic air traffic.

The initiative asks rail passengers in Germany to lodge protests against airlines at large railway stations in the country as well as on the Internet. Passengers can also calculate for themselves the tax breaks enjoyed by the airlines on a special form which can be downloaded from the Internet and demand that the finance minister pay back the environmental tax charged on their tickets.

"That's totally acceptable: passengers just have to say that they traveled by rail for so many kilometers and would like to have the taxes paid back," said Timm. "Or the other alternative in this campaign is that a similar tax should also be imposed on jet fuel."

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