The UK could raise an extra £5.9bn a year in revenue if jet fuel was taxed, campaigners have said.
Road fuel duty is currently levied at just under 53p a litre, and accounts for approximately 5% of government revenues. However, unlike drivers, hauliers, rail operators and farmers, airlines do not pay tax on the fuel they burn. In 2023, airlines burnt roughly 11.1 million tonnes of jet fuel – almost the same amount of petrol as was burnt in the UK last year.
The Transport & Environment (T&E) think tank estimated that the government could raise anything from £400m to £5.9bn annually depending on the routes covered and tax rate applied.
It suggested applying a 9p fuel duty rate to kerosene starting in 2025 and raising this on an annual basis until it matched road fuel duty by 2030. It also said that airlines should purchase 90% of the fuel for all departing flights at UK airports to prevent them from buying untaxed kerosene from abroad.
Whether or not fuel duty can be applied is dependent...