EU ready to suspend CO2 air travel tax for a year

The European Union executive on Monday offered to "stop the clock" on its controversial carbon tax on air travel by suspending the measure for a year on flights to and from non-European nations.

The EU's climate commisioner Connie Hedegaard said at a hastily-arranged news conference that she had just recommended in a phone conversation with the 27 EU nations that the tax be suspended in the interests of negotiating a global CO2 deal.

The suspension of the EU's emissions trading system, or ETS, would affect flights "to and from non-European countries", she said.

Hedegaard said she had proposed "stopping the clock for one year" on the hotly-contested tax following signs of a move towards a global deal, or "market based mechanism", at a general meeting on Friday of the International Civil Aviation Organization (ICAO).

"Now it seems that because of some countries' dislike of our scheme many countries are prepared to move in ICAO," she said. The EU tax is to be frozen until after the next ICAO general assembly in autumn 2013.

"It goes without saying that in the unlikely event of the ICAO Assembly failing to move forward, the EU ETS legislation would be applied in full again from 2013 onwards.

The EU imposed the Emissions Trading Scheme (ETS) on January 1, but over two dozen countries, including India, Russia, China and the United States, have opposed the move, saying it violates international law.

"Nobody wants an international framework tackling CO2-emissions from aviation more than we do," Hedegaard added. "On the contrary, our regulatory scheme was adopted after having waited for many years for ICAO to progress."

Brussels says the scheme is designed to reduce carbon emissions blamed for climate change, and will help the 27-nation bloc achieve its goal of cutting emissions 20 percent by 2020.

But airlines allege it will cost 17.5 billion euros ($21.2 billion) over eight years.

The EU counters that the cost is manageable, estimating it could add between four and 24 euros to the price of a round-trip long-haul flight.

India and China have been at the forefront in opposing the scheme. India in April barred its airlines from complying with the EU carbon fee, joining China in resistance.

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