Hungary proposes delaying aviation fuel taxation until mid-century amid environmental concerns

Euronews reported this week it has received a leaked document showing Hungary is proposing delaying taxes on airline and maritime fuel until mid-century. Currently, diesel, gasoline, and electricity used for rail and road vehicles are “heavily taxed,” according to Euronews. However, airlines and marine vessels, from fishing boats to cruise ships, pay no fuel taxes. The policy is seen as a means of stimulating air travel, but environmentalists find the measure counter to Europe’s commitment to green energy.

Three years ago, the European Commission proposed a reform to a 2003 Energy Taxation Directive that would help achieve a target of cutting 55% in CO2 emissions by 2030. Part of the proposal was eliminating the tax exemption for aircraft and maritime vessels. But the reform has been delayed.

One reason why the proposal faces an uphill battle is that, under EU rules, approval must be secured from all 27 member states. According to the leaked document, Hungary has proposed formally postponing any plans to scrap the tax exemption until 2049. This has put the non-government organization (NGO) Transport & Environment directly at odds with the airline industry, as represented by Airlines For Europe (A4E).