Designing Aviation Taxes Within the EU: Chartering Ongoing Challenges and Proposing Future Solutions

This Article focuses on environmental taxes, specifically aviation taxes, and the challenges and limitations EU law imposes on individual EU Member States when they attempt to enforce both national and international environmental policy goals. Both the former Irish and the recently implemented Swedish aviation tax are used as comparative examples when chartering and discussing what (legal) obstacles are posed by EU law and, subsequently, the options available to individual Member States when attempting to design and implement environmental taxes. Further, common political obstacles are addressed in the Swedish and Irish case studies to further enhance the understanding of why and how aviation taxes are designed the way they generally are. A holistic approach, resulting in the inclusion of not only tax law and environmental law elements but also EU free movement law and EU state aid law in parallel legal systems (at domestic level and EU level) is applied to provide a more coherent and transparent outlineof the studied matter. The Article affords, through a tax technical study combined with environmental and economic theories, a conceptual framework on how an aviation tax may be designed to fulfil environmental goals and generate tax revenues while still complying with EU law. The Article comprises differing methods in calculating CO2 emission offsetting. Calculating factual taxation of individual flightsoffers the reader further understanding of the polluter-pays principle and present (in)efficiency of aviation taxes at Member State level. Despite the Article only covering aviation taxes applied within the EU, these discussions are of great relevance to scholars outside of the EU considering the increasing interest in climate law and the potential of environmental taxes when pursuing climate goals at both national and international levels. Additionally, policy discussions will only become more relevant over time due to ongoing environmental discussions and the implementation and enforcement of the UN’s sustainability goals.