Green jet fuel levy for air cargo deferred for a year

Singapore's Civil Aviation Authority of Singapore (CAAS) has announced a one-year deferral of the green jet fuel levy for air cargo, with the levy set to commence on October 1, 2027, for flights departing from Singapore on January 1, 2028. The decision to postpone the levy stems from the diverse nature of air cargo and the involvement of various businesses and agencies, such as airlines, freight forwarders, and shippers, each with distinct commercial arrangements.

CAAS explained that the one-year delay will provide ample time for collaboration with the industry to establish a robust and sustainable aviation fuel levy collection mechanism specifically for cargo shipments on departing flights. Passengers in economy or premium economy class will be required to pay a levy ranging from S$1 to S$10.40, depending on their destination, while business or first-class passengers would pay between S$4 and S$41.60.

The levy is based on industry norms for calculating the carbon emissions of passengers in different cabin classes. Industry players welcomed the decision to defer the air cargo green fuel levy, as it allows for a more measured and sustainable transition, enabling companies to plan ahead and communicate with customers and partners before the fee takes effect.

The levy's implementation will be based on four geographical bands, with higher levies for longer flights.