The European Parliament gave its resounding approval Tuesday to new fuel taxes, the ending of airlines' Value Added Tax exemption and a closed emissions trading scheme, urging the EU to "take a leadership position in global aviation in order to reduce the climate change impact of aviation."By a vote of 439 to 74 with 102 abstentions, members called on the European Commission to introduce a fuel tax on nearly all domestic and intra-EU flights that, according to press reports, would double the cost of many flights offered by low-fare carriers. It also voted to end aviation's VAT exemption, which would "further level the playing field and bring fiscal as well as environmental benefits."

The EP said that an effective emissions trading scheme requires "broad geographical scope, a rigorous cap, full auctioning of initial allocation" and would have to be separate from other industries. "Due to the lack of binding commitments for international aviation emissions under the United Nations Framework Convention on Climate Change and the Kyoto Protocol, the aviation sector would be unable to actually sell into the ETS," it said, adding that even if aviation eventually is to be incorporated into a wider ETS, a separate pilot phase should run from 2008 through 2012. Even then there would be restrictions. Parliament's plan would force airlines to buy emissions permits and include a hard cap.

In December, EU environmental ministers advocated incorporating aviation into the EU's ETS (ATWOnline, Dec. 5, 2005).

EasyJet was quick to respond to the vote, which is nonbinding. "Instead of addressing obvious but politically contentious issues such as inefficient air traffic management and state aid for ailing national airlines, MEPs went for a headline-grabbing bashing of one of Europe's most successful industries," CEO Andy Harrison said. The LCC said that according to EC estimates, aviation accounts for 3% of the EU's carbon dioxide emissions and would reach 5% by 2030 at current growth rates. In contrast, power generation contributes 34% and road transport 20%.