Inadequate revenue from aviation taxes on fuel and tickets, which fund the U.S. aviation infrastructure and the agency that regulates it, is how some in the FAA justify their desire for user fees to make up the difference. Before they go there, why doesn’t government catch up with current airline business practices and include the myriad fees that are not subject to the ticket tax.
We’re taking some serious money here, an average of $250 million a year from baggage fees alone, according to a Washington Post article, “As airlines raise fees instead of fares, taxpayers pick up the tab.” As the article’s graphic above shows, between 2007 and 2012 the airlines collected $12.8 billion in baggage fees. At the 7.5 percent ticket tax rate, that’s $960 million in lost revenue. During the same period, the airlines charged another $11 billion to change a ticket.
Simply put, airline fees not subject to the ticket tax is one reason why aviation revenue has not kept pace with its costs. Let’s face it, we’d all like tax-free income, but it is not fair to anyone who pays the fees and uses the system. The DoT took the first step in its fiduciary responsibilities when it required airlines to include all applicable fees when passengers bought a ticket. Making the total subject to the ticket tax seem the logical next step.
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