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EU's carbon tax now faces fire closer home

india Updated: Mar 01, 2012 02:20 IST
Tushar Srivastava
Tushar Srivastava
Hindustan Times
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Opposition to the controversial European Union (EU) carbon emission tax on airlines is increasing with even European carriers joining the chorus for a re-think.

British carrier Virgin Atlantic has said it is worried about the "disjointed approach" and the "retaliatory taxes" being mulled by countries like India.

"Aviation is a global industry and there has to be a global solution and I think we haven't done the best job," Julie Southern, chief commercial officer, Virgin Atlantic, told Hindustan Times.

Virgin Atlantic, she said, had made its views clear to the British government and the EU commissioner.

"We are worried about Emission Trading Scheme (ETS) in terms of the reaction it is getting from major governments around the world and we need to make sure that from UK and European point of view we don't make life even harder for European airlines," she said.

Under the EU ETS, local Indian carriers flying to Europe would need to pay taxes for landing in and taking off from European airports based on the type of aircraft, which in turn, would lead to an increase in airfares by as much as $50-250 (R2,600-13,300) and cost Indian carriers as much as R500 crore annually. India has termed the tax as "unilateral" and an "extraterritorial imposition" of the EU's policies on other countries.

"If you don't have a global scheme you will end up with piecemeal imposition of different structures all around the world, which will be impossible to deal with and almost impossible to explain to a passenger that there is a European tax, an Indian tax, a US tax," she said.