Dubai Airline Plans To Offset EU Carbon Tax – Tax

February 21st, 20128:58 pm @

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by Lorys Charalambous, Tax-News.com, Cyprus

Dubai-based Etihad Airways has plans to increase the fuel surcharge on flights
to Europe in an attempt to minimise the damage caused by the EU’s new carbon tax.

The airline plans to increase the charge by USD3 per passenger for flights
in and out of the European Union with USD0.03 per kilogram being added to cargo
shipments. The charges will be in effect from March 1, 2012.

According to the airline, the charges are calculated based on the additional cost to
Etihad for the carbon credits the airline will be required to purchase for 2012
in order to comply with the EU ETS. Etihad said that this cost may need to be
adjusted from time to time as carbon prices fluctuate.

Etihad President and Chief Executive Officer James Hogan said:

“As an airline we are strongly opposed to the unilateral measures imposed
by the European Union on our flights into and out of Europe, especially as they
include areas outside European airspace.”

“We have invested many millions of dollars to ensure we operate a young
and highly efficient fleet but are still being penalised.”

“Our efficiency is reflected in the relatively low additional charge
and we will continue to be transparent in keeping our customers fully informed
of this carbon charge.”

Under the ETS, starting from January 1, 2012, airlines operating into and out
of the EU, regardless of how long that flight is in EU airspace, will be required
to surrender varying emission allowances, and will be required to purchase any
additional permits outside of their free allowance. Non-EU nations’ airlines
would also be required to pay such an emissions tax to the EU member state to
which they most frequently fly, without any requirements that those EU countries
use the funds collected in emissions reduction efforts.

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Article source: http://www.tax-news.com/news/Dubai_Airline_Plans_To_Offset_EU_Carbon_Tax____54029.html