EU: Transport & Environment is urging EU policymakers to abolish VAT on international train tickets and pair the exemption with rolling-stock support, stronger industrial policy and safeguards for aviation slots.

Two Eurostar trains at platforms inside London St Pancras station.
Eurostar trains at London St Pancras, shown as an illustrative view of international rail travel; centre-cropped to 16:9. Photo: Fraselpantz / Wikimedia Commons / CC0 1.0.

The environmental group set out the recommendations in a July 2026 position paper on the EU high-speed rail plan. Its intervention comes as the European Parliament develops an own-initiative report intended to strengthen the European Commission’s November 2025 plan.

VAT reform targets ticket costs and tax differences

T&E wants the forthcoming review of VAT rules for travel and tourism to establish an EU-wide exemption for international passenger rail. It also argues that existing exemptions for aviation and passenger shipping should end.

The organisation estimates that abolishing VAT on international train tickets would cost public budgets between €106 million and €117 million a year. A separate T&E methodological analysis says Croatia, Germany, Spain, Belgium and the Netherlands still apply VAT to international rail travel, while Greece also taxes such tickets but currently has no cross-border rail services.

In 2023, about 16.3 million passengers departed from the five countries with active international services and VAT, according to the analysis. That is less than a quarter of international rail passengers in the EU. T&E cautions that its budget estimate is indicative because some international passenger-kilometre data had to be approximated.

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Rolling stock and airport slots enter the debate

The recommendations extend beyond ticket taxation. T&E warns that replacing short-haul flights with trains may fail to reduce emissions if airports allocate the released slots to long-haul services. It therefore wants climate conditions attached to airport expansion and slot-allocation rules, with success measured through actual emissions reductions rather than the number of flights removed.

Rolling-stock supply is another concern. T&E proposes a European railway industrial strategy to harmonise requirements, simplify national rules, expand production capacity and make more second-hand trains available. The group argues that new infrastructure alone cannot create services when operators cannot obtain suitable trains or face long production lead times.

The European Commission’s high-speed rail plan already envisages 2027 measures against anticompetitive scrapping of safe rolling stock and transparent conditions for resale across Member States. T&E is pressing for a broader industrial framework and financial guarantees for train procurement.

Cross-border pilot services could continue to 2035

T&E proposes extending the EU cross-border pilot programme to 2035 so operators can introduce more international services before major high-speed infrastructure is completed. It cites Prague–Copenhagen and Naples–Berlin as routes supported by the programme, while noting that other projects stalled or were abandoned partly because operators struggled to acquire rolling stock.

The group also wants rail included in national renewable-electricity credit systems. Finally, it says EU funding for missing cross-border TEN-T sections must be matched by coordinated national investment, otherwise new international links could feed into slower or capacity-constrained domestic lines.

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