Here’s a development that counters the industry trend, especially as countries set climate goals…
In this post:
Sweden abolishing tax on air travelers
In a major policy reversal, the Swedish government has announced that it will eliminate its aviation tax as of July 2025. This was revealed as part of the government’s 2025 budget bill, which otherwise includes more spending on infrastructure, research, and innovation, as well as tax relief on foreign exports.
The government states that it’s getting rid of this tax in hopes of replacing national climate policies with larger European Union goals.
This proposal needs to get final approval in parliament later this month, though the government holds a majority, with parties having agreed on these budget measures. Sweden’s government has been accused of backtracking on climate goals, with many arguing that the current cabinet has no plan to reach the country’s ambitious climate targets.
For background, Sweden introduced this tax back in 2018, and it’s intended specifically to discourage people from traveling by air. Sweden is known for its progressive climate policies, so that was hardly surprising. The country even coined the term “flying shame.”
This tax ranges from 76 SEK (~7 USD) for short haul flights, to 504 SEK (~49 USD) for long haul flights. The tax applies specifically to itineraries originating in Sweden, so those simply transiting the country aren’t subjected to this.
Of course tickets to and from Sweden will still have some taxes, like for airport security, immigration, etc. But the main tax is being eliminated.
This is great news for airlines and passengers
Suffice it to say that Sweden eliminating a tax on air travel is fantastic news for both airlines and consumers:
- The airline industry is very low margin, so this will give airlines a bit of flexibility with pricing; this tax is more than the margin on many tickets
- Ultimately the airline industry is also very competitive, so much of these savings will be passed on to consumers, and that should stimulate demand
Personally I’m very happy to see Sweden backtrack on its aviation tax:
- I don’t like the concept of just charging people more to dissuade them from something
- It’s one thing if the revenue from this had been used directly for carbon offset and/or reforestation projects, rather than just going into the general government budget, to be used however
- These kinds of taxes are unfair to citizens of the country, since transit passengers through the country aren’t charged the taxes, despite flying (and polluting) more
Bottom line
As of July 2025, Sweden plans to abolish its aviation tax, which currently ranges from $7 to $49, depending on the itinerary. The country is doing this as part of a pro-business budget bill. Over the years we’ve seen quite a few countries introduce aviation taxes to dissuade travel, so it’s interesting to see Sweden dropping this.
What do you make of Sweden eliminating its aviation tax?
A smart move given how out of the way it currently is and how they probably want to encourage people to go there or transfer there
Tons of domestic routes and airlines ceased over the last few years due to this tax, making it hard, if not impossible, to get anywhere through the rocks and trees (and water) of Sweden in a timely manner if no private car is involved. At least flying saves millions of trees that don't have to make way for railroads where one train a day (at most!) is passing - if not cancelled due to the...
Tons of domestic routes and airlines ceased over the last few years due to this tax, making it hard, if not impossible, to get anywhere through the rocks and trees (and water) of Sweden in a timely manner if no private car is involved. At least flying saves millions of trees that don't have to make way for railroads where one train a day (at most!) is passing - if not cancelled due to the weather, lack of staff, signal failure, or simply a gang of angry moose blocking the tracks.
I have to agree that any taxes levied for a certain purpose should actually be used for that purpose, but that's something Scandinavians in general just don't get. Norway is a tax hellhole right now and no one knows how it's being spent, for example. It's even worse that people who transit are not levied, while stopover flights are considered to be more polluting than direct flights. It makes no sense.
But before any celebrations start: they're looking to replace and align it with European rules and goals. I guess we have to keep an eye on Brussels to see what's cooking. The ghost of Green Levy is haunting.
Where are the electric car batteries disposed after use?
I love so much how sweden advocates saving our environments and taking good care of nature,I hope! I love nature so much and I understand living in harmony with nature is life but I keep asking one question and please someone answer me. Where do all the used electric car batteries disposed?
Thank you Greta!
Now can Sweden finally get its own national airline?
I think governments should ban airlines to offer significantly cheaper tickets with a stop and jack up the direction flight prices. It really makes people fly unnecessarily, just the opposite of tax.
Surely Swedish government invests into its (rather substantial) environmental policy much more than the income from this tax so I wouldn't say it's not used to offset flying.
As for injustice - the idea is that everyone taxes their departing passengers and no taxes are levied in the transfer point. This is actually much more just in my opinion as everyone the same route is taxed the same, irrespective of where they transfer.
"I don’t like the concept of just charging people more to dissuade them from something"
Guess you didn't major in econ.
Do you hate "happy hours" too? If you want to dissuade people from polluting with gas cars... You can... Tax gas! If you want to have people buy electric cars you can... Create a subsidy! But how do you pay for the subsidy then? With... Taxes!
You'll get it at some point, Florida man.
Correct me if I'm wrong, but isn't a happy hour the opposite of charging people more to dissuade them from doing something? In my experience, a happy hour is a period where customers are charged less, usually in an effort to drum up business during slow periods, or get people lubed up so they spend more once prices return to normal.
I agree with you on the logistics of happy hour.
I was trying to make the point that prices send a signal. We can either charge people to dissuade or discount to invite or any number of variations/terms. Sometimes we call things a "tax" or a "credit" or a "happy hour". But the idea is the same. Pricing alters behavior.
I mean Ben covers travel. If people in Barcelona or Ibizaor Kyoto think tourists...
I agree with you on the logistics of happy hour.
I was trying to make the point that prices send a signal. We can either charge people to dissuade or discount to invite or any number of variations/terms. Sometimes we call things a "tax" or a "credit" or a "happy hour". But the idea is the same. Pricing alters behavior.
I mean Ben covers travel. If people in Barcelona or Ibizaor Kyoto think tourists are over running their cities... Charge them! Pretty sure the folks in New Zealand and Sweden know the idea behind what they're trying with either increasing visitor visa fee or reducing airfare tax.
High taxes on gasoline are designed to incentivize the shift toward electric vehicles and renewable energy sources like solar power. However, as the adoption of these cleaner technologies grows, governments often face a decline in gasoline tax revenue, which historically has been a significant funding source for infrastructure and public services. To compensate for this loss, governments may be compelled to explore new revenue streams, such as taxing clean energy solutions. This can create a...
High taxes on gasoline are designed to incentivize the shift toward electric vehicles and renewable energy sources like solar power. However, as the adoption of these cleaner technologies grows, governments often face a decline in gasoline tax revenue, which historically has been a significant funding source for infrastructure and public services. To compensate for this loss, governments may be compelled to explore new revenue streams, such as taxing clean energy solutions. This can create a counterproductive cycle where the pursuit of greener alternatives is undermined by new tax burdens, potentially diminishing the overall effectiveness of the initial environmental incentives - there are very similar parallels with the airline industry. Air travel is a worldly necessity - we can't live in huts made of hemp, growl our own vegetables, smoke weed and sit around and sing kumbaya.
Well from an economic perspective it might help to dissuade people from doing something, but it is at the same time reducing total utility, therefore no intervention should be made.
The how about, uhhh, not having electric car subsidies or not taxing gas then you dont need the taxes. Gee, I mustve majored in econ!
What they give in one hand they will take in another! The EU will announce the long awaited “green levy” charge on airlines and ultimately passengers over the coming months so any perceived savings will be null and void.
Florida has rotten your brain if you think this is good news. On the plus side, your state will be underwater soon enough.
Why not delegalize flying in Sweden? I doubt anyone believes increasing the ticket price by $7 stops people from flying LOL.
@ jsnna -- I'm curious, what do you think the correct amount is to tax on flying to discourage it? $7 per flight? $70? $700? $7,000?
I would assume that jsnna believes that (in opposition to you) 0 is not the ideal amount to discourage people from flying, thus their comment.
On a related note, did you also think that taxing cigarettes heavily was also not a good way to discourage people from smoking?
I do think that you are right, that if you put in a tax to discourage harm to the environment, that the proceeds should go to reducing harm to the environment.
@farnorthtrader
Like I said beforehand, taxing addictive substance doesn't discourage people. It's greed.
Whether you agree with it or not, punitive taxes on cigarettes (together with public health campaigns) have unarguably been highly effective at reducing tobacco smoking rates. In the US, it has fallen from a high of nearly 50% to about 12 % today. A similar trend is observable across almost every other developed economy.
If there's one thing US history shows pretty unambiguously, it's that taxing and regulating is more effective than prohibition.
@farnorthtrader Why do you think we should discourage people from flying? People on the Thunberg side of the argument seem to think this is a given for all people involved in the discussion, but that is not the case.
What a snarky response... I don't read the blog much any more, but you've significantly changed from when I first started reading!
And what stupid options. I'd personally set it as the price determined to mitigate the damage caused by taking that flight, which probably isn't going to be a 7 followed by a random number of 0's...
found the lib
How many decades now FL has been projected to be underwater?
Zero to my knowledge? The last thing I remember reading is some coastal cities will be by 2050. Surely you're not deliberately lying about false predictions to try and discredit your opponents!?
The climate clowns will keep telling you its imminent for the next 50 years until climate change is no longer profitable.
@jsnna- I say Europe has rotten your brain into thinking more taxes are good and that daddy government will solve everything. Seriously, the amount of people all over Europe who like to depend on the government for literally everything in their lives is concerning.
I say you're, surprise surprise, living in a fantasy world because it's easier than having to formulate an argument based on reality.
I've not met a single European who likes to depend on the government for "literally" (you do know what that word means, right?) everything in their lives, so I'm afraid your concern is unnecessary.
Oh look, the climate fun sponge goblins are out today.
The fact that insurance companies are pulling out of Florida entirely and are refusing to insure homes in many areas of California should be a very clear indicator to you that climate change isn't a hoax. Places that were relatively low risk of natural disasters 20, 30, 50 years ago are now high risk. If you have say a 70-80% chance of having a major hurricane or wildfire destroy your 30-year mortgaged home within the...
The fact that insurance companies are pulling out of Florida entirely and are refusing to insure homes in many areas of California should be a very clear indicator to you that climate change isn't a hoax. Places that were relatively low risk of natural disasters 20, 30, 50 years ago are now high risk. If you have say a 70-80% chance of having a major hurricane or wildfire destroy your 30-year mortgaged home within the next 15 years, no insurance company would insure you. They quite literally couldn't afford to. Will you cry "communism" when DeSantis bails out Florida's state-run home insurance company after the next major hurricane hits Florida?