ACI Europe Director General Olivier Jankovec has accused the Danish government of “political greenwashing” over plans to introduce a new passenger tax on domestic and international routes from 2025.
The proposed tax is expected to average at DKK70 ($10) per passenger in 2025, rising to an average of DKK100 in 2030. Proceeds will be “partially returned” to the aviation industry through investments in green aviation, as well as going toward supporting elderly people in Denmark.
Jankovec says the levy is “truly ill-advised” and will damage the competitive position of Danish airports, thereby hampering their ability to finance their decarbonization plans.
“Rather than helping airports and aviation to decarbonize, it will actually have the opposite effect by diverting much-needed financial resources away from the sector,” he adds. “The [European Union] has already put in place through the Fit for 55 package an ambitious regulatory framework to decarbonize its aviation sector through tightening its Emission Trading Scheme and mandates for deploying sustainable aviation fuels.
“Along with other measures, this will require additional investments from the whole aviation ecosystem to the tune of €820 billion ($890 billion) by 2050. So clearly, new taxes are the very last thing we need. If anything, more financial support is what is required.”
Denmark’s government says the new tax is expected to generate revenues of DKK1.2 billion and will help to finance an ambition of using 100% sustainable fuels on domestic flights by 2030. Climate, Energy and Supply Minister Lars Aagaard says the move will “create that change” so sustainable flights become a reality.
The amount charged per passenger will vary based on flight duration, with shorter journeys taxed at about DKK60 per passenger by the start of 2030, and long-haul flights at around DKK390. Transit passengers will be exempt from the tax.
However, Jankovec claims the proposals “risk hurting the connectivity of Denmark and its economy” given air traffic has not fully recovered from the effects of the pandemic. According to OAG Schedules Analyser data, there are about 353,000 departure seats from and within the Scandinavian country during the week commencing Nov. 13, equivalent to 85% of 2019 levels.
Danish ministers have recognized that smaller regional airports in the country will be disproportionately affected by the passenger tax, so has allocated DKK550 million for initiatives specifically aimed at them. This assistance is expected to cover funding for sustainable aviation fuel infrastructure and the continuation of a program aimed at attracting new international flights.