If the German federal government's latest fundraising plans are put into action, the Lufthansa Group in particular will likely be confronted with significantly higher costs in domestic German air traffic. After aviation taxes, VAT and other taxes, they now also want to levy a kerosene tax.
Of course, this is once again happening under the guise of environmental protection, but the main aim is to bring fresh money into the cash-strapped coffers of Germany, which is defacto facing national bankruptcy. Due to international treaties, no kerosene tax can be charged for international flights. Things look different in domestic traffic. The Federal Republic would not be an isolated case here either, as Norway, for example, has been asking for additional money in this segment for some time.
Apart from a few smaller providers, the German kerosene tax would primarily affect the Lufthansa Group, including its low-cost subsidiary Eurowings. Other providers, such as Ryanair and Easyjet as well as Lübeck Air, have already largely withdrawn from domestic German business. Domestic volumes have now halved - in direct comparison with the value before the corona pandemic.
Due to a lack of competition, flight prices are already exorbitantly high, and in some cases the train is not a cheap or reliable alternative. Domestic German air travelers would therefore have to be prepared for any kerosene tax to be passed on to passengers in the form of higher prices. This would lead to a further decline in demand and, as a result, most likely to lead to the closure of further domestic routes. It is therefore questionable whether the German Finance Ministry will not indirectly accelerate the heartfelt wish of "environmentalists" - the closure of domestic flights - or whether it will actually be able to generate significant revenue. Given the significant budget deficit that the federal government has, the revenue from a domestic German kerosene tax for commercial flights would only be a very small drop in the ocean anyway.