Europe’s Aviation Emissions Rise as Tax Gap Leaves €8.5 bn Untaxed

Context A new analysis by the consultancy T&E shows that 2025 marked the first year European departures surpassed pre‑pandemic emissions. The sector released 195 Mt of CO₂, accounting for 23 % of global aviation emissions and making Europe the only top‑three region to recover fully.

Key Facts - Emissions rose 2 % compared with 2019, driven mainly by low‑cost carriers. Ryanair alone emitted 16.6 Mt CO₂ from European departures, 50 % above its 2019 level and the highest among European airlines. That amount equals the annual emissions of a country the size of Croatia. - The EU Emissions Trading System (ETS) currently taxes only intra‑EU short‑haul flights. As a result, roughly two‑thirds of aviation emissions from Europe remain untaxed. - If the ETS covered all departing flights, annual revenue would climb from €4.1 bn in 2025 to about €17 bn by 2030. In 2025, airlines avoided over €8.5 bn in carbon costs because those flights fall outside the scheme. - Legacy carriers with long‑haul networks have not yet recovered to pre‑pandemic levels, while short‑haul traffic, especially from budget airlines, has rebounded strongly. - The most polluting intercontinental routes, such as London‑New York, generated nearly 1.4 Mt CO₂ in 2025—equivalent to the combined emissions of the ten dirtiest intra‑EU routes.

What It Means The emissions rebound highlights a structural loophole: once a plane leaves the European Economic Area, the EU loses the ability to price its carbon, shifting responsibility to the weaker CORSIA offset scheme. Extending the ETS to all departures would close the €8.5 bn revenue gap and provide funds that could be earmarked for sustainable aviation fuel production and contrail‑reduction projects. Such investments could accelerate the shift toward zero‑emission aviation while delivering immediate climate benefits.

Looking Ahead Watch for EU policy proposals on expanding the ETS scope and for industry responses as the debate over carbon pricing versus ticket‑price impacts intensifies.