Singapore’s green tax: Air passengers to additionally pay nearly $32 from 2026; levy to fund sustainable aviation fuel purchases

Singapore will soon introduce a sustainable aviation fuel (SAF) levy of up to S$41.60 (around $31.95 or Rs 3,690) per passenger beginning next year, marking a significant step in its efforts to reduce carbon emissions in the aviation sector.

The Civil Aviation Authority of Singapore (CAAS) announced that the levy will apply to tickets sold from April 1, 2026, for flights departing from October 1, 2026. Passengers transiting through Singapore will be exempt from the charge.Under the new system, the amount of levy will vary depending on travel class and route distance. Economy and premium economy travellers will pay S$1 for short-haul trips within Southeast Asia and S$10.40 for flights to the Americas. Business and first-class passengers will be charged four times that amount, reported Bloomberg. Cargo flights will also face a separate fee, calculated by weight.The funds raised through this levy will support the centralised purchase of sustainable aviation fuel — typically produced from waste oils or agricultural feedstock — as part of Singapore’s plan to achieve an SAF adoption rate of 3–5% by 2030. According to CAAS, a drop in SAF costs has allowed the levy to remain lower than earlier projections, which had estimated rates between S$3 and S$16.

Singapore becomes the first country in the world to impose a passenger-based green fuel tax — a move especially notable given its position as a major global aviation hub. Changi Airport is on track for a record year, with passenger traffic expected to surpass its pre-pandemic peak of 68.3 million in 2019.Although aviation contributes only around 1.2% of global greenhouse gas emissions, as per the European Commission cited by Bloomberg, the industry continues to face significant challenges in cutting emissions due to limited SAF availability and high production costs. The International Air Transport Association noted that while global SAF production doubled last year, it still accounted for just 0.3% of total jet fuel volumes.Singapore’s announcement coincides with the COP30 climate summit in Brazil, where nearly 200 countries are discussing measures to strengthen global climate action.