When Will the E.U. Cave on Its Extraterritorial Airline Emissions Tax?

When Will the E.U. Cave on Its Extraterritorial Airline Emissions Tax?

Maybe the EU will stick to its guns on its controversial airline emissions tax, but I somehow doubt they will not eventually be forced to cave.

(Reuters) – Senate lawmakers and the Obama administration on Wednesday stiffened their opposition to a European law that targets emissions from commercial jetliners and applied new pressure on Brussels and the United Nations to resolve global concerns.

In a rare display of election-year bipartisanship, Democratic and Republican members of the Commerce Committee and the administration’s top transportation official called the EU standard that puts a price on pollution unworkable.

I’ll note that both China and India (as well as other countries) have reacted even more harshly to the proposed EU tax.  The ECJ has held that the EU tax does not violate international treaties or customary law.  This seems plausible to me, but I wonder if the political pushback the EU is getting will ultimately force it to back off.  I’m betting yes. Any readers more knowledgeable about this issue, however, are welcome to share their thoughts in the comments.

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An Hertogen

I don’t think the EU will formally back off, but they have given themselves some leeway in deciding whether the domestic measures of other states are equivalent in effect. There have been reports that they are studying possible Chinese measures. 

What I find more interesting in this saga is that ICAO has ramped up work on developing a multilateral response. Of course, it remains to be seen whether something will happen, but interesting nonetheless after all those years of dragging their feet…

Also, the ECJ has held (convincingly in my opinion) that the cap and trade system is not a tax. But of course, if you’re against the system it’s more fun to label it one.