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            november 17, 2019

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US weighs retaliatory action against Europe's aviation carbon tax


US President Barrack Obama is considering retaliation against the European Union for its carbon emissions tax on flights to and from Europe.
But there is no White House consensus on what to do, if anything, reports Reuters. Some officials suggest a reciprocal tax to pressure EU policymakers, a move successfully deployed against Argentina in a landing fee dispute, but might not have the same effect in this case.
Costs of the carbon tax, called an "emissions trading scheme" will be phased in with carriers expected to cover 15 per cent of the carbon they emit in 2012. Payments would start in 2013 with fines levied for non-compliance.
Said a White House official: "We are contemplating a wide range of possible steps. We haven't decided to move forward on any specific one."
US airlines, some of which have already raised fares to offset the EU carbon trading scheme, expect a formal response from the Bema administration.
"We take the White House at their word that they are prepared to take action, which could include a country-to-country legal action, retaliatory measures or any number of steps to urge the withdrawal of the EU's unilateral scheme in favour of a global approach," said Steve Lott, a spokesman for the US industry's leading trade group, Airlines for America.
The State Department and the Department of Transportation have warned the European Union that the administration was prepared to "respond appropriately" if the EU did not reconsider the measure or seek a negotiated settlement through the United Nations.
The US, China, India and others have attacked the scheme, saying it infringes on their sovereignty. They argue the EU should not act alone and instead work through the United Nations.
But while US officials are talking to the Europeans and other countries in hopes of a diplomatic solution at the United Nations, they nevertheless have begun to prepare for a possible retaliatory step against European airlines, according to the Shipping Gazette. 

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