Aviation is subject to a unique tax regime characterized by a lower level of taxation than many other sectors of the economy. This low-tax regime is rooted in a series of interwoven national, European, global and bilateral rules and agreements. In order to still raise fiscal revenue from aviation, a number of countries have introduced aviation ticket taxes over the last decades. Invariably, these initiatives have been met by opposition from airlines and often opposed in courts, though in most cases the taxes were deemed lawful.
The aim of this study is to analyse which aviation ticket tax designs have held up in court and can therefore be considered as a template for new taxes. The study also analyses how and to what extent aviation ticket taxes can be used to internalize the external costs of aviation, with a focus on climate impacts.