Carbon tax would be ‘staggering failure’: airlines

An Air Canada 787 lands at Vancouver International Airport. (photo: Brett Ballah)

A federal carbon tax would send airfares soaring and not reduce carbon emissions in the country’s aviation sector, according to a new report issued by a group representing Canada’s largest airlines.

“Our new study shows that a domestic carbon tax would add more than $800 million a year to the cost of air travel in Canada by 2030” said Massimo Bergamini, President and CEO of National Airlines Council of Canada said in a news release. “An increase that large would hurt individuals and families who rely on air travel for work, to visit family, and for basic necessities.”

The council represents Canada’s largest airlines, including Air Canada and Westjet. The study was conducted by AirTrav, an aviation consulting company based in Toronto.

Its report “Evaluation of Federal Carbon Tax Costs on Domestic Air Travel: 2019 -2030” says a carbon tax would unfairly harm residents in smaller remote communities where air travel is the only way viable way to travel.

For example, a family of four travelling round trip from Thunder Bay to Toronto would pay $121 in 2030 more because of the carbon tax, and the same family travelling from Halifax to Calgary would pay $411 more.

“When assessed against the federal government’s stated public policy goals, such as carbon-emission reduction, avoiding trade and emissions leakage, lowering the cost of air travel, growing consumer choice in commercial aviation, growing the visitor economy and tourism in general, a carbon tax on air travel would be a staggering failure,” said Bergamini.

The country’s airlines are in the midst of a passenger and cargo boom, with airports across the country reporting record passenger numbers in 2018. NAV CANADA, which manages the country’s air traffic control, says traffic increased 5.1% last year.

The NACC study also suggests a carbon tax on aviation would hurt tourism and drive Canadians to fly out of border airports in the United States, where the tax would not apply.

Putting a price on carbon emissions is a key part of the federal government’s initiatives to reduce greenhouse gasses, a driving factor behind climate change.

The industry argues it has gotten more efficient over recent years, buying newer aircraft and adopting more environmentally-friendly ground handling operations. It also argues an international carbon offset program to sequester or absorb emissions would be better a better solution than a carbon tax.

Transport Canada reports that in 2017, Canada’s aviation sector emitted 21 megatonnes of carbon dioxide, a 66% increase over 2005. But in that same time, revenue-tonne-kilometres, a key airline metric measuring passenger and cargo traffic, more than doubled, meaning planes used less fuel for each kilometre flown.

Still, environmentalists point out that aviation pollutes disproportionately compared to other forms of travel. The David Suzuki Foundation says “The aviation industry is expanding rapidly in part due to regulatory and taxing policies that do not reflect the true environmental costs of flying. ‘Cheap’ fares may turn out to be costly in terms of climate change.”