Singapore to impose world's first green fuel levy; passengers flying out to pay up to Rs 3,690

Singapore will impose a sustainable aviation fuel levy of up to S$41.60 (Rs 3,690) per passenger starting next year, marking a key step toward reducing 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 Singapore from October 1, 2026. Passengers transiting through Singapore will not be charged.

Under the new system, the amount paid will depend on travel distance and class. Economy and premium economy travelers will pay S$1 for flights to Southeast Asia and S$10.40 for trips to the Americas. Business and first-class passengers will pay four times more. Cargo flights will also face a levy, calculated by weight.

The funds collected will go toward the centralized purchase of sustainable aviation fuel (SAF), typically made from waste oils or agricultural feedstock. Singapore aims to achieve a 3% to 5% SAF adoption rate by 2030. According to CAAS, the decline in fuel costs has allowed the government to keep the levy below earlier projections of S$3 to S$16.

Singapore’s decision is significant as it becomes the first country to impose a passenger-based levy for green fuel. Changi Airport is set for a record year, with passenger numbers expected to surpass the pre-pandemic high of 68.3 million recorded in 2019.

Although aviation contributes about 1.2% of global greenhouse gas emissions, the sector faces hurdles in decarbonizing due to limited fuel availability and high costs. The International Air Transport Association reports that while SAF production doubled last year, it still made up only 0.3% of global jet fuel.

The announcement coincides with the COP30 summit in Brazil, where nearly 200 countries are negotiating new climate measures. Singapore’s initiative signals growing global pressure on the aviation industry to fund its transition toward cleaner fuel.