Report

Impact of an increase in air passenger tax

In the December 2021 coalition agreement, the Dutch government announced that it would increase air passenger tax with the goal of raising an additional €400 million each year starting in 2023. The Ministry of Finance has asked CE Delft to determine the price required for this and to analyse the effects of the increase.

We analysed the effects of the increase in four future scenarios and two vision years (2024 and 2030) with regard to:

  • tax revenue;
  • the Dutch aviation sector, such as the number of passengers and flights;
  • the climate and environment.

We calculated that the current air passenger tax should be increased by €17.95 to a new air passenger tax of €26.33 per departing passenger. This tax is independent of travel destination, which means that ticket prices for short flights would rise relatively more than for long flights. Transfer passengers and air cargo are excluded from the tax.

The impact of the tax increase on the total number of passengers at Dutch airports is between -2.0% and -6.2% (all data is for 2024). At around -12%, the decrease at regional airports is clearly harder than at Schiphol (-0.7% to -5.6%). The impact on the number of transfer passengers travelling via Schiphol varies from -2.7% to +5.9% depending on whether Schiphol is below or at its capacity limit.

The impact of the number of flights is highly correlated to the impact on the number of passengers and varies between -1.2% and -5.9%. Flights to European destinations fall more sharply (-2.2% to -6.7%) compared to intercontinental flights (+2.7% to -3.0%).

Overall, the decrease in flight movements creates a positive sustainability impact. Well-to-wing CO2 emissions fall between -0.18 and -0.53 million tonnes taking into account diverting behaviour by passengers. Emissions from landing and take-off (also known as LTO emissions, which are CO, NOx SO2, VOC and PM10) fall to 5% in most cases. The impact on noise levels at Schiphol (the number of houses in the 58 dB (LDEN) contour) are between -3.8 and +0.7%. Only in scenarios where capacity is squeezed do LTO emissions and noise pollution at Schiphol increase slightly. This is due to the shift to more intercontinental flights in these situations, which are generally operated with larger and therefore more polluting and noisier types of aircraft.

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