DB has been talking for some months about the exemption causing unfair competition and therefore being a violation of EU competition law, but only in the last few weeks has it talked of taking legal action.

This is believed to be motivated by the announcement by Lufthansa that it plans to compete directly with low-cost airlines and DB on domestic and intra-EU routes. With DB expecting to lose £350million this year, it wants a level playing field for future baffles for customers.

Tax has not been levied on aviation fuel since the Chicago Convention came into force in 1944. For many years it was widely believed the convention banned tax on fuel.

This is not true, but no country or bloc has yet been willing to be the first to impose a tax for fear of damaging the competitivity of its airlines.

The EU has threatened to act unilaterally if no international action is taken, but has yet to do so.

Meanwhile the new report has attempted to quantify the environmental costs of air travel in terms of costs per passenger.

The report, by environmental re-search consultancy CE Delft (NL) and commissioned by the German government’s environment office UBA, says a 300 mile flight from Berlin to Munich in a fully occupied 100-seat plane would cause £650,000 of unpaid-for environmental damage (£7 per passenger), while a 4,000 mile flight from Frankfurt to Chacago in a fully occupied 400-seat plane would cost £12,000 in unpaid costs (£28 pcr passenger).

UBA president Andreas Troge said: Flying is getting cheaper and cheaper because of the intense competition, but it’s happening on the back of a series of subsidies which are costing the taxpayers of Germany around £5billion a year.

Troge added that the recently stated intention of the government coalition not to exempt flights to other EU countries from value added tax was a step in the right direction.

November is awareness month in Great Britain, during which the campaign group AirportWatch is trying to tell people about the impact of aviation on the environment.

The campaign centres on four themes: health, historic buildings and heritage sites, flawed economics, and climate change.

Visit: www.airportwatch.org.uk

This news item comes from the European Federation of transport and Environment.

www.t-e.eu

11.12.02