New Jersey's Senate Transportation Committee approved a bill which would impose an additional fuel tax on United Airlines (UA, Chicago O'Hare), raising opposition from the carrier and major business groups in the state and in New York, NJBIZ has reported.

The proposed law would tax all fuel bought by the carrier at New York Newark, as opposed to only the amount of fuel burnt during taxi, take-off, and landing from the airport, as well as during the flight over New Jersey under the current legal framework.

United said that if enacted, the new law would raise its annual costs by USD20 million.

The law would affect only airlines carrying more than 8 million passengers per year out of Newark, effectively, exclusively United.

The authorities intend to use the extra revenues to fund the extension of the PATH railway from Manhattan to Newark airport. The airline has previously challenged such a use of the revenues. Under federal US law, airport fuel taxes can only be used to fund aviation infrastructure.

United has previously warned it might shift some connecting traffic from Newark to other hubs, such as Washington Dulles.