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BASIC Nations Slam EU ETS On International Aviation

by Lorys Charalambous, Tax-News.com, Cyprus

23 July 2012


A joint statement issued at the conclusion of the 11th BASIC (Brazil, South Africa, China and India) Ministerial Meeting on Climate Change, held in Johannesburg on June 12-13, 2012, has criticized the extension of the European Union’s emissions trading scheme (EU-ETS) to international aviation.

The EU ETS was extended to aviation activities from or to European soil on January 1, 2012, to provide a solution to taxing aviation emissions, which were excluded from the Kyoto Protocol. Under the ETS, airlines operating into and out of the EU are required to immediately begin purchasing emissions allowances, but are only expected to remit the sums in 2013.

In the event that airlines fail to comply, the EU has said it will impose fines of up to EUR100 (USD122) for each tonne of carbon dioxide emitted without the payment of a permit, and eventually enforce an EU-wide ban on the offending airline.

However, a number of nations are opposed on the grounds that the EU ETS breaches the Chicago Convention, which prohibits taxation of international aviation, and last March the heads of some of Europe's major airlines and aviation engine manufacturers also called upon EU leaders to take action and stop an escalating trade conflict with China and other countries.

The joint statement by the four BASIC countries, who have become influential in the global climate change debate, confirmed that "ministers were deeply concerned at the continued unilateral action by the EU to include international aviation in the EU-ETS, including intentions for similar unilateral measures, and called for immediate withdrawal of such actions that violate the multilateral rules based system and adversely affect trust amongst parties.”

TAGS: South Africa | environment | tax | India | aviation | China | tax rates | carbon tax | Brazil | European Union (EU) | Europe | Africa

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