The Dutch flight tax
A TICKET TO A SUSTAINABLE FUTURE?

Recently, attention to the harmful effects of flying has increased. More and more travelers acknowledge that their behaviour has consequences for the future of the earth. In our introduction magazine, we established that, of all means of transportation, air travel can be considered the main contributor of climate change. Therefore, we believe that, for the sake of the earth, the aviation sector should be made more sustainable, either through reducing the number of flights or by implementing technologies that cut back emissions of airplanes. Another way that is often used for improving the sustainability of flying is CO2 compensation on flights. You can read more about this in the article of Emmy. From a policy perspective, there are different measures that can be taken to make the aviation sector more sustainable. One option is to use command and control instruments where a country can impose mandatory obligations or restrictions on the behaviour of airlines or other firms in the aviation sector that cause negative environmental impacts. On the other hand, countries can employ economic incentives to make it more beneficial for firms in the aviation industry to pollute less. Examples range from subsidies or transferable permits.

In 2018, the Dutch government introduced a proposal to implement a flight tax that is supposed to be put into practice in 2021. Although the government believes that a flight tax should be implemented in the whole European Union, it calls for implementation of the tax in the Dutch aviation sector regardless of a shared European policy. With the implementation of the flight tax, the Dutch government follows the example of many other countries in Europe that have already implemented such a tax. In addition to greening the tax system and making the aviation sector more sustainable, the tax is also meant to compel travelers to take into account the negative environmental consequences of their choice of transportation.

In the Netherlands, there are already taxes on the use of other means of transportation, such as cars, busses and trains. With the introduction of the flight tax, the government tries to make it more attractive for travelers to get to their destination by train, which is acknowledged to be more sustainable. The Dutch government prefers to tax the plane itself, which allows them to differentiate between more and less polluting types of airplanes. Taxes for more polluting planes would be higher, stimulating technological innovation to reduce CO2 emissions on polluting airplanes. However, this is considered difficult to implement, so that taxing the flight ticket becomes a second option. Currently, flight tickets are relatively cheap. With airlines such as Ryanair offering flights for very low prices and often with high discounts, financial limitations increasingly do not keep travelers from booking plane tickets. Currently, there are no taxes on the use of kerosene, which is contributing to CO2 emissions and gives the aviation industry an unfair advantage over other transportation industries that are being taxed. Additionally, the many airlines competing with each other on the market increasingly drives down the prices of flight tickets.  

The introduction of the flight tax in the Netherlands has not been without discussion. Opponents of the flight tax argue that in the past - in 2008 to be precise - a certain flight tax had been introduced. However, because this caused such a decline for the aviation sector it was withdrawn that same year. The aviation industry therefore expects that the same thing might happen again, threatening the continuity of their firms and the jobs of their employees. They argue that the flight tax will cause travelers to turn to airports in surrounding countries to fly cheaper, causing problems for the Dutch aviation industry, such as economic degrowth or unemployment. The case of unemployment and the loss of jobs in the Dutch aviation sector is elaborately studied by the Dutch research agency CE Delft. This agency acknowledges that there might be fewer jobs in the aviation sector due to a decrease in the amount of passengers . However, because the revenues of the taxes can be reinvested, this might create jobs elsewhere in the economy. Additionally, according to the Dutch government, the tax revenues can be reinvested in climate regulations or can be used to reduce other taxes, so that it positively affects the economy. Interestingly, in case that government spending is effectively reinvested, even the representing organization of the travel industry approves the implementation of the flight tax.

From an environmental perspective, it can be questioned to what extent this flight tax will really decrease the environmental degradation caused by flying. In the current plans of the Dutch government, the price that is added to a flight ticket as a result of the tax is quite small. For European flights, the tax would increase original ticket prices with €3,80. For intercontinental flights, an additional amount of €22,- will be added to the original ticket prices. However, these numbers do not seem final, as there are also sources that mention an amount of €7,- added to ticket prices, regardless of the destination. CE Delft has studied the effects of this increase in ticket prices for travel demand . This research shows that the total number of Dutch passengers would only decrease a half a percent as a consequence of the price increase. Thus, it appears that the effect of the flight tax on the environmental consequences of flying is very small.  Maybe the idea to make flying less attractive is only solving one side of the problem. To address the other side of the problem might require making alternative means of transportation, such as public transportation, more attractive for travelers.

 

In conclusion, we do not think that a flight tax (as proposed by the Dutch government) might have the effect on the behaviour of travelers that we would like to see. Changing the behaviour of people in general is a widely researched and complicated task. From a sociological perspective, it can be argued that an increase in price should address the rational travelers that determines its behaviour with cost-benefit analysis. However, this would ignore the influence of wider social structures on the behaviour of consumers. To facilitate change in travelers’ behaviour might thus require an approach that also seeks to alter the general perspective towards flying and the environment. For example, the term ‘vliegtuigschaamte’, which means being ashamed of flying because people consciously harm the environment, is increasingly recognized. Nevertheless, the idea of the flight tax is a step towards directing more attention to the negative consequences of flying and might stimulate travelers to choose for different means of transportation.

 by Femke

​References

  1. Brandsma, J. (2018, June 29). Vliegbelasting is 'goed voor de economie'. Retrieved February 22, 2019, from https://www.trouw.nl/home/vliegbelasting-is-goed-voor-de-economie-%7Ea3536be2/

  2. Pauw, P. (2018, July 25). Zes redenen om de vliegtaks per direct in te voeren. Retrieved February 22, 2019, from https://www.nrc.nl/nieuws/2018/07/25/zes-redenen-om-de-vliegtaks-per-direct-in-te-voeren-a1611170

  3. NOS. (2018, June 29). Kabinet wil in 2021 vliegtaks invoeren. Retrieved February 22, 2019, from https://nos.nl/artikel/2239035-kabinet-wil-in-2021-vliegtaks-invoeren.html

  4. Duursma, M. (2018, June 30). Vliegtaks komt er, hoe dan ook. Retrieved February 22, 2019, from https://www.nrc.nl/nieuws/2018/06/30/vliegtaks-komt-er-hoe-dan-ook-a1608498

  5. Ministerie van Algemene Zaken. (2018, July 31). Kabinet start internetconsultatie vliegbelasting. Retrieved February 22, 2019, from https://www.rijksoverheid.nl/actueel/nieuws/2018/06/29/kabinet-start-internetconsultatie-vliegbelasting

  6. Ministerie van Algemene Zaken. (2018b, December 7). Kabinet stuurt wetsvoorstel vliegbelasting naar de Raad van State. Retrieved February 22, 2019, from https://www.rijksoverheid.nl/actueel/nieuws/2018/12/07/kabinet-stuurt-wetsvoorstel-vliegbelasting-naar-de-raad-van-state

  7. AD. (2018, December 7). Vliegtaks wordt 7 euro, ongeacht reisbestemming. Retrieved February 22, 2019, from https://www.ad.nl/politiek/vliegtaks-wordt-7-euro-ongeacht-reisbestemming~affe4ef5/

  8. NOS. (2018b, December 7). Vliegbelasting jaren geleden afgeschaft, waarom zou het nu wel werken? Retrieved February 22, 2019, from https://nos.nl/artikel/2262444-vliegbelasting-jaren-geleden-afgeschaft-waarom-zou-het-nu-wel-werken.html

  9. Perman, R., Ma, Y., McGilvray, J., & Common, M. (2003). Natural Resource and Environmental Economics (3rd ed.). Harlow, United Kingdom: Pearson Education Limited.

TheGreenGrasshopper