Proposed Taxes in UK Aviation Industry

MICRO-ECONOMICS

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY ..................................................................................................................................3
A. Proposed taxes in UK aviation industry..................................................................................3
B. Evaluation of Preposed Tax....................................................................................................4
CONCLUSION................................................................................................................................5
REFERENCES................................................................................................................................1

INTRODUCTION
Aviation companies are levied on taxes which are charged in the form of taxes and other
charges collected ultimately by the passenger's fair (Krenek, Schratzenstaller, 2017). These
charges are levy due to climate change and environmental damage through aviation companies
like Easy Jet. Propose tax help passengers and airline companies to charge only related tax for
social and environmental cause.
MAIN BODY
A. Proposed taxes in UK aviation industry.
The existing scenario of taxes in the UK aviation industry is mixed up with a variety of
charges, being collected from passengers in the form of taxes and other charges. As, the prices
are very high after the Covid-19 impact, these charges consequently have become very high for
the passengers and airline companies. The overall cost borne by the passengers in the travelling
charges have increased after the pandemic and government has further increased the charges due
to environmental damage from aviation industry. This has caused high impact on passenger's
savings in the form of charges.
Firstly, these charges can be changed in Proposed Tax structure for UK aviation industry
by segregating total cost in social and environmental taxes, fuel and other travelling charges. It
can be proposed that UK aviation should charge these taxes separately from all passengers.
Aviation industry can charge these taxes with overall 30% in the form of social charges. These
charges can be further divided into 3 different segments i.e. overall 15% of the cost would be
charged through tickets, then 10% can be gathered through the meal charges on every ticket and
remaining 5% through “others” such as fuel etc. (Galindo, Beltran, Caballero, 2018).
While Ticket tax and fuel taxes are mandatory to be paid by the passenger as they use the
service and are involved in the changing climate condition impact from through pollution like
carbon emission and carbon dioxide. But, meal taxes can be charged only from those passengers
who avail this facility with the airline companies. As the charges are very high after the
pandemic, various costs impact on the consumer income and regular saving which are ultimately
charged by airline company. This segregation of total social cost being charged can help the
passengers to save money and hence only for the facilities that they are actually using, they will
be required to pay the taxes.