Qantas has warned that it will pass on the cost of a new Australian carbon tax to passengers in the form of higher fares.
The tax is expected to increase the cost of the carrier’s operations by as much as A$115 million (£76.7 million).
Qantas expects the price on a single domestic flight to rise by about A$3.50 in 2013.
It comes as Australian Prime Minister Julia Gillar announced that carbon dioxide emissions would be taxed at A$23 per tonne from 2012.
Qantas said: "In the context of the significant challenges facing the global aviation industry, the Qantas group will be unable to absorb the additional costs associated with the carbon price and there will be a full pass-through to customers.”
The new tax compounds pressure from high fuel prices on the Australian carrier which has already indicated it plans a major shake-up of its international operations.
Chief executive Alan Joyce was quoted by Australian media over the weekend as saying: “The international business has not been performing at the levels it needs to.
“We need to make significant changes to our international services as a consequence to the under-performance of the business today.”
Joyce said the company will take an "honest and aggressive" view on how its international operations are being run.
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