Industry Challenge:
New and increased taxes adopted by several European countries may carry significant negative implications for business aviation, particularly charter operators.
NBAA Response:
NBAA will continue working with the British Business and General Aviation Association, IBAC and other international business aviation groups to mitigate undue European tax burdens and fees.
Steep increases to French solidarity taxes are the latest in a series of actions targeting business aviation throughout the European Union and United Kingdom, posing added challenges for charter operations, in particular.
Effective March 1, 2025, business jets with 19 seats or fewer will incur steep per passenger charges on flights originating within France, based not on actual flight distance but instead the distance measured from Paris to the arrival country’s primary airport serving the French capital.
Fees range from 420 euros for a passenger on a business jet flying to a destination within the EU or European Economic Area to 2,100 euros per passenger flying to a destination more than 5,500 km away. Passenger fees for turboprop aircraft are roughly half the jet rates.
“They've really increased those costs significantly [and] charter customers will bear the brunt of those added charges.”
Adam Hartley, Regulatory Strategy and Development Lead at Universal Weather and Aviation
“Those increases are the latest attempt to curb aviation carbon emissions in the country,” said Adam Hartley, regulatory strategy and development lead at Universal Weather and Aviation. They’ve really increased those costs significantly [and] charter customers will bear the brunt of those added charges.”
That will “absolutely incentivize people not to take charter flights out of France,” said Rick Snider, director of contracts and compliance with Flight Pro International.
Instead, passengers may use alternate transportation out of the country, only to board a business aircraft elsewhere. “Are you actually stopping that activity,” Snider said, “or are you just changing where it occurs?”
UK officials are considering a similar increase to the Air Passenger Duty (APD) for travel on aircraft with a maximum takeoff weight (MTOW) of at least 5.7 tonnes (12,566 pounds) to align with the current UK APD on aircraft with MTOW of 20t (44,100 pounds) or more.
The British Business and General Aviation Association (BBGA) joined with two other industry groups in commenting on that proposal, noting such an increase could lead to unintended consequences, including a rise in illegal charter operations.
“Aircraft 5.7t to 20t are more price sensitive with the same regulatory costs burden as for heavier aircraft but with lower pricing points,” the groups said. “Higher taxation will lead to raising of pricing to consumers who are already very price sensitive.”
A response from HM Treasury is expected later this year, said BBGA Managing Director Lindsey Oliver.
Other countries have adopted similar fees, ostensibly to reduce aviation carbon emissions. A new air passenger tax in Denmark, effective Jan. 1, 2025, applies to commercial aircraft with more than 10 passenger seats or weighing more than 5,700 kg.
The Danish tax aims to foster and fund greater adoption of sustainable aviation fuel. While the new fees aren’t as high as others, “it’s definitely a sign of the times,” Hartley said.
International Business Aviation Council Ltd.