Environmental groups urge German gov't to scrap plans to cut aviation tax
Clean Energy Wire
Environmental groups have criticised the German government's plans to lower aviation tax, calling the move ecologically counterproductive and fiscally irresponsible, according to a joint letter to chancellor Friedrich Merz.
The federal cabinet today (1 April) approved a draft law that would reduce air passenger tax rates to the level they were before May 2024, reversing an increase introduced by the previous government. The finance ministry said it was “important that these reductions are passed on to passengers”. Chancellor Friedrich Merz announced the plan last year, saying the move would boost the country’s aviation sector.
Germanwatch, sustainable mobility group VCD, and Bundesvereinigung gegen Fluglärm (BVF), a group focussing on reducing the harmful effects of air traffic, called on the government to halt the draft legislation, however, arguing against the tax cut from “a climate policy perspective and given the current economic and fiscal situation”.
“Reducing the air passenger tax is ecologically counterproductive, economically ineffective, and fiscally irresponsible,” the groups said, adding that it burdens the federal budget and weakens an important climate policy instrument. At the same time, it is questionable from a social and distributional policy perspective, and provides only sporadic and unsustainable relief to the aviation industry, they said.
The tax reduction, scheduled to go into effect on 1 July, would result in reduced revenue of some 200 million euros this year and around 350 million euros annually thereafter, they noted. Pointing out that some 70 percent of the population either does not fly at all or only once a year, the NGOs said reduced tax revenue would make it impossible to provide targeted relief to broad segments of the population in other areas. Electricity prices, already hiking as a result of the current international energy crisis, were one example of where such funds could be better directed, they said.
The groups described air traffic as “the most climate-damaging mode of transport and, at the same time, structurally privileged: kerosene is tax-free, and international flights are exempt from VAT and emissions trading.” The air passenger tax, alongside the intra-European emissions trading system, is “one of the few instruments that internalises at least some of the external environmental costs,” they said.
Boris Rhein, premier of the state of Hesse, home to Germany’s largest airport in Frankfurt, welcomed the move. “The reduction of the air traffic tax is an important first step to ensure that 2026 becomes the comeback year for German aviation.”
Aviation is one of the world’s most polluting sectors. In 2024, a working group on climate-neutral aviation in Germany made up of government officials and industry representatives called for a clear commitment by politicians and industry to the sustainable aviation fuel market ramp-up, and other key measures to cut the sector’s greenhouse gas emissions.