Up, up or away? Europe's air tax divide and what it means for Gulf travellers

Duties on passengers set to rise in Britain and Denmark but disappear in Sweden after twist in green debate

Britain has Europe's highest rates of air passenger tax - and is expected to raise them again in its budget this month. Getty Images

If you book a flight tomorrow from Sweden's capital Stockholm, to Abu Dhabi, your ticket will come with an air travel tax of 315 crowns ($30).

Fly to the UAE from Copenhagen in Denmark instead and there's no such tax to pay. It's almost tempting to get a train over the Oresund Bridge that connects the two countries to take advantage.

But if you fly this time next year, take the train in the opposite direction. Because while Denmark is introducing a passenger tax from January, amounting to 250 crowns ($36) for Middle East destinations, Sweden is abolishing it next July.

They are not the only countries in Europe torn between the demands of environmentalists, who want to make polluters pay and raise money for greener air travel in an era of climate change, and airline bosses, who say taxes on flying merely damage the economy and drive business abroad.

Britain is tipped to raise air passenger duty in a belt-tightening budget on October 30, despite a threat from Ryanair's hard-driving boss Michael O'Leary to cut hundreds of UK flights if the levy increases. Airlines are also bracing for tax rises in France.

Analysis by The National reveals the UK's rates are the highest in western Europe for a flight to the UAE. The charge in Britain is £88 ($114) to fly roughly 3,000 to 9,000 kilometres in economy class, or £194 ($252) in business class.

The Netherlands has a flat rate, while Austria charges less for the Middle East than for short-haul flights, promoting other forms of transport in Europe. French levies depend on the departure airport, with a higher "security and safety rate" due on air fares from Paris. Ireland has no aviation tax.

Sweden's Prime Minister Ulf Kristersson last month declared aviation tax a "substantial competitive disadvantage for Swedish airports" as his government moved to scrap it from July 2025. Airline lobby group Iata called the levies that the Swedes and others had imposed counterproductive economically and ineffective environmentally.

“We congratulate the Swedish government for abolishing the aviation tax," said Rafael Schvartzman, IATA’s regional vice president for Europe. It is excellent news, which recognizes that taxation of air passengers is counterproductive economically and ineffective environmentally. Better air connectivity boosts the productive capacity of the economy, leading to stronger tax revenues in the long term."

Ryanair swiftly announced 10 new routes from Stockholm and Gothenburg, although it threatened to put them on ice if a separate airport charge is increased. The airline last year cancelled six routes from Venice after a tax rise of €2.50 ($2.70) per passenger under Italian rules that let local authorities set rates.

Sweden's cut "should translate into lower air fares, but most importantly it will encourage more competition", John Grant, chief analyst for flight data company OAG, told The National. He said the Netherlands "literally saw travellers crossing the borders to go from alternate airports" under a previous tax.

Environmental case

Environmentalists see things differently, pointing out that most of Europe does not tax airlines for buying commercial jet fuel. "Compared to UK motorists, UK air passengers have a really good deal," said Tim Johnson, director of the Aviation Environment Federation.

"If we were charging UK air passengers the same rates of duty that we apply to the sale of petrol or diesel in the UK, it would probably raise three times more," he said. "From that point of view, air passengers are paying less than consumers are to do other activities and other modes of travel."

Denmark has embraced the idea of raising money for green aviation. The new charge, which will rise to 310 crowns ($45) for a Middle East by 2030, is ring-fenced for clean technology. Airlines complain that levies such as the €1.5 billion ($1.62 billion) raised in Germany last year tend to disappear into general budgets.

A recent summit in Germany heard the industry needs to rapidly expand production of sustainable aviation fuel if it hopes to replace traditional jet fuel in its engines any time soon. More radical innovations such as hydrogen planes are thought to be a longer way off.

Iata said in its response to the Swedish tax cut that the sprint to net-zero flying by 2050 is "non-negotiable" but "will not be achieved by pricing people off planes". A thriving industry producing sustainable fuel is what will help, it argued.

Mr Grant said Germany was "way adrift of the average" in its post-Covid recovery with a projected 132 million seats available for international air travel this year, down from 160 million in 2019. Low-cost options from Sweden are also down, although in both cases the passenger duty is not the only factor at play, he said. Environmentalists are not sure the tax is really so damaging.

In Britain, the volume of air traffic increased almost every year between 1994, when air passenger duty was introduced, and the last pre-Covid year in 2019, Mr Johnson said. He said money was being spent on promoting sustainable fuels even if it was not directly drawn from the airline tax revenue.

"There's always been an ongoing commitment to increase APD in line with inflation, so I would expect that as a minimum" from Britain's October 30 budget, he said. "From an environmental point of view, we think there will be a strong case to increase APD in the UK even further."

For hard-pressed passengers worse could be to come despite the backlash to high taxes in countries like Sweden. A campaign group called Stay Grounded issued recommendations on Thursday for a frequent-flyer levy throughout Europe, which it said could raise $80 billion towards "accelerating the transition to a fairer, greener economy". The proposal is designed to target flying beyond a threshold. To raise the sums it is talking about people would be taxed starting from their second return flight of the year.

"Globally, one per cent of the world’s population produces 50 per cent of aviation emissions, while approximately 80 per cent have never set foot on a plane," said a report backed by charities and protest groups such as Friends of the Earth and Fridays for Future.

Many of these groups have sought to make flying unpleasant in their own way and airports have frequently been targeted by climate protesters carrying out their own campaign.