Opposition to the scheme, under which airlines operating in the EU must purchase "credits" if they exceed strict carbon emission limits, has grown sharply since its introduction at the start of the year. The total cost to airlines of ETS is expected to be £1 billion this year, but – due to the annual lowering of carbon emissions targets – it could increase to £2.9bn by 2020. The extra costs are likely to result in higher air fares.
According to the International Air Transport Association, at least 40 countries – including India, Russia and the US – have voiced their opposition to ETS, and the decision by China’s State Council to ban its airlines from paying the tax could encourage other governments to follow suit.
Critics of ETS say it raises the cost of travelling but does nothing to help the environment. It has also been suggested that the imposition of an EU tax on non-EU airlines is unlawful and impedes national sovereignty.
Last month Telegraph Travel reported that anger over ETS had led to the possibility of retaliation from non-EU countries, or even a trade war. An Indian government official recently suggested that those countries which oppose the scheme were considering imposing new taxes and restrictions on flights from the EU, a move which could result in even sharper increases to the cost of flying beyond Europe.
The cost of flying long-haul from Britain has already soared in recent years, following sharp increases to Air Passenger Duty (APD), which – when introduced in 1994 – was billed as an environmental tax.
Since 2007, APD on long-haul flights has increased from £20 to £85 per person in economy class, and it is to set to rise again in April.
Calls for APD to be reduced, to offset the introduction of ETS, have so far been ignored.