EU parliament backs plan to tax airline fuel

The European Parliament has backed a plan to tax airline fuel and to remove a series of tax breaks given to airlines, in an effort to curb greenhouse gas emissions.

MEPs voted by an overwhelming majority in favour of a package of environmental measures that would also bring airlines into the EU emissions trading scheme.

The measures are opposed by budget airlines such as Ryanair, which has already threatened to stop flying to Sweden if it introduces its own planned green airline tax.

Aviation is one of the fastest growing sources of CO2 emissions, with the number of flights in the EU set to double by 2020. However, aviation fuel is not subject to VAT and the sector is not bound by strict targets to cut emissions set in the Kyoto protocol.

The new proposals on the airline industry are contained in a non-binding report that was supported by 439 MEPs. There were 102 abstentions and 74 MEPs voted against. Although the report is non-binding, the European Commission is preparing legislation on the issue and is expected to make an announcement on formal proposals this year.

The vote comes as the emissions trading scheme, which was established by the commission to encourage industry to reduce greenhouse gas emissions, faces its second crisis in a month. It emerged yesterday that just one EU state has submitted its allocation plan for the second phase of the scheme for 2008-12 by a deadline set for last Friday.

Estonia met the deadline set by environmental commissioner Stavros Dimas, but the 24 other EU states - including Ireland - failed to submit plans to cut CO2 emissions.

Poland and Germany finally submitted their national allocation plans yesterday.

A commission spokeswoman said an official warning letter would be sent to states that had not submitted, within two weeks, their plans to cut greenhouse gas emissions.

An Irish spokesman in Brussels said Ireland's second national allocation plan should be submitted to the commission in a matter of days.

But the failure of many EU states to send in their national allocation plans or to propose stringent cuts in green gas emissions is another disappointment for the emissions trading scheme.