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India, US, China call EU airline tax unacceptable

India, US, China call EU airline tax unacceptable
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First Published: Fri, Sep 30 2011. 11 17 PM IST

Photo Courtesy: Bloomberg
Photo Courtesy: Bloomberg
Updated: Fri, Sep 30 2011. 11 17 PM IST
New Delhi: A group of 25 countries, including India, the US, China, Japan and Russia, jointly condemned as unacceptable an environmental levy that the European Union (EU) plans to impose on airlines from January.
India, which has taken the lead in opposing the move, hosted the two-day meeting of aviation representatives in Delhi that ended with a joint declaration expressing their views. The Indian government will send a demarche to the European Union on behalf of the countries that met in Delhi next week with a copy of the joint declaration, said civil aviation secretary Nasim Zaidi.
Photo Courtesy: Bloomberg
“It’s one voice, one language,” Zaidi said after the summit. “Aviation (emissions) is a global problem and therefore there has to be a global solution. There cannot be a regional or a countrywise solution. All countries opposed the EU proposal. They have pointed out several illegalities. It is inconsistent of the international legal regime”
Under the planned Emission Trading Scheme (ETS), airlines using EU airspace will have to pay a fee for carbon emissions that exceed a set cap even for the leg of the flights completed over non-EU airspace. This is expected to be passed on to passengers as an additional levy. The countries that met in Delhi included Argentina, Brazil, Canada, China, Chile, Colombia, Cuba, Egypt, Japan, South Korea, Malaysia, Mexico, Nigeria, Paraguay, Peru, the Philippines, Qatar, Russia, Saudi Arabia, Singapore, South Africa, Thailand, Turkey, the United Arab Emirates and the US. The EU’s comment on the joint declaration was not immediately available. An email sent to the EU spokesperson remained unanswered.
In a previous communication, the EU had said the ETS was not a tax but “a cap-and-trade system designed to keep emissions covered by the system within a predetermined limit... It is an emissions ceiling, and is one part of the EU’s comprehensive approach towards reducing aviation’s climate-change impacts. If an airline can manage to cut its emissions to the expected level, it doesn’t need to incur any costs at all.”
The joint declaration said ETS measures violate the Chicago Convention governing international aviation as well as World Trade Organization norms. It asked the International Civil Aviation Organization (ICAO) to continue to undertake efforts to reduce aviation emissions and urged the EU to work collaboratively with the rest of the international community to address aviation emissions.
“The members present most importantly decided to intend to continue to work together to oppose the imposition of the EU ETS on our operators and invite any other state to associate itself with this declaration,” it said.
Russia will host the next meeting of the 25 countries in November.
Aviation secretary Zaidi declined to specify the counter measures India and other countries are planning to take against the EU move.
“We are trying all possible legal, moral and diplomatic routes,” he said.
Another Indian government official present at the conference said counter measures were raised by several countries. “But it was considered too hypothetical to think of them at this time,” this official said, declining to be named. “Will EU be able to take this kind of pressure? We will see.”
Ernest Arvai, president of US-based aviation consulting firm Arvai Group Inc., said countries won’t accept the levy because once they do the EU could increase it further, depending on the escalation of the ongoing European financial crisis.
“This is just another tax for the failing euro zone, and the world wants no part of it,” Arvai said in an email. “The industry has a sound working framework for progress, and countries around the world have recognized the EU-ETS for what it really is—another tax and transfer of wealth from the efficient private sector... Never give in to a new tax—as it will only go up and never go away.”
tarun.s@livemint.com
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First Published: Fri, Sep 30 2011. 11 17 PM IST
More Topics: EU | ETS | Emissions Trading Scheme | Airlines | India |