Sustainability-oriented tax-based own resources for the European Union: a European carbon-based flight ticket tax

Abstract

The failed attempts of several European countries to introduce a flight ticket tax and the pressure on those European Union Member States still levying such a tax clearly demonstrate the limits of national aviation taxation. Assigning a carbon-based flight ticket tax to the EU level would reduce the tax enforcement problems inherent to mobile tax bases and put a stop to harmful tax competition between EU Member States. By replacing a part of national contributions to the EU budget a flight ticket tax can strengthen sustainability-orientation of the EU system of own resources. Using a new data set, which assigns to approximately 75 to 90% of the respective intra and extra EU routes flown in the year 2014 the corresponding carbon emissions per passenger, the paper estimates the expected revenue from implementing a carbon-based flight ticket tax at the EU level for carbon tax levels between 25 and 35€ per ton of carbon emissions.