Denmark has approved proposals made by the government in November to raise taxes on air passengers. The new taxes, which will be implemented in phases across 2025 and beyond are intended to fund a green transition in the aviation sector, by hundreds of millions of kroner.
How much will flyers pay?
The details of the plan have now been finalised, with taxes reaching 50 Danish kroner (€6.71) per passenger for European flights by 2030. Medium-distance flights meanwhile will attract a 310-krone (€41.58) levy and long-haul flyers will have to pay an extra 410 kroner (€55) for the privilege.
However, passengers on “transit flights” that depart again after only a short stopover in Denmark will not have to pay the fees.
The passing of the measure means the race is now on to fund that green transition, not only ahead of 2050 and its net-zero carbon emissions deadline, but moving Danish aviation 100% to green fuel by 2030, if the government has its way.
Aviation has been found to be responsible for about 3.5% of climate change, according to the National Oceanic and Atmospheric Administration. While ecological milestone stunts, such as Virgin’s recent fully-SAF-fuelled transatlantic flight, are being pulled out of the bag, arguments over SAF are still raging, with many pointing out the fuel’s flaws, which include, at the moment, a dire lack of raw materials and insufficient power capacity to make enough SAF a viable alternative to fossil fuels.
Sustainable power solutions
But the new Danish funds will help to subsidise the development and growth of green aviation fuels by the end of the decade to the tune of more than 550 million kroner (€73.77 million). The Danish state will be supporting sustainable power solutions, such as the renewable energy conversion method known as “power-to-X”, as well as bio-fuels or SAF and hydrogen technology.
Another portion of the money raised will go towards topping up the Danish state pension for those on the lowest old age pension regime.
The “tax gap”
Other countries reconsidering their relationship with aviation will be watching the Danish move with interest. Traditionally, aviation has been subsidised by various national governments by low taxation and lack of powers to tax the fuel that aircraft carry. A study released earlier this year by campaign group Transport and Environment found that European governments lost out on €34.2 billion in revenue last year due to what it terms the “tax gap”. The group points out that €34.2 billion could “pay for 1,400 km of high-speed rail infrastructure – equivalent to the distance from Hamburg to Rome.”