The German government has approved the controversial green tax on air travel.
The air travel levy, which must be paid on all departures from German airport as of January 1, is expected to raise €1 billion a year.
Passengers will be forced to pay €8 for flights within Germany and short-haul European flights, while for medium-haul flights the fee will be €25 and for long-haul €45.
Budget carrier Germanwings condemned the new tax as a major distortion of competition, as passengers will choose to fly with airlines outside of Germany.
Thomas Winkelmann, Germanwings management spokesman, said: "It places jobs at risk, restricts people's mobility and acts as a brake on economic recovery in our country. The winners with this new levy are the airports in Holland, Belgium, Poland and Switzerland."
Passengers will lose out, he added: "We will have to pass on the levy introduced by the government to our customers. The levy drains economic power out of Germany and displaces it into neighbouring countries."
Giovanni Bisignani, CEO of the International Air Transport Association (IATA), called the tax "short-sighted policy irresponsibility".
He said: "It's a cash-grab by a cash-strapped government. Painting it green adds insult to injury. There will be no environmental benefit from the economic damage caused."
According to Bisignani, when the Dutch government tried to raise €300 million with a similar tax, it cost the Dutch economy €1.2 billion in lost business.
"It also failed as an environmental measure," he said, "sending travelers across the border to start their journey from more tax-sensible regimes. The Dutch had the good sense to repeal their tax. Why repeat past mistakes?"