Airlines for America: Travel is Taxed Too Much

A4A Calls on U.S. Travel to Stop Advocating for Excessive Taxes on Air Passengers

WASHINGTON, May 5, 2015 – As the U.S. Travel Association celebrates National Travel and Tourism Week by asking travelers to complete the sentence, “Travel is __________,” Airlines for America (A4A), the industry trade organization for the leading U.S. airlines, is urging U.S. Travel to recognize that “Travel is taxed too much” and stop waving the banner for a proposed tax increase on airline customers.

A4A is stepping in to protect passengers and filling in the blank to remind Congress, the Administration and others that higher taxes on air travel harms passengers and the economy. Air travel is already taxed at much higher rates than other modes of transportation, and U.S. Travel’s efforts to increase the Passenger Facility Charge (PFC) – or Airport Tax – will only exacerbate the problem.

“It is ironic, to say the least, that an organization advocating for the travel industry would seek to burden travelers with even more government-imposed taxes and fees,” said Sharon Pinkerton, A4A Senior Vice President, Legislative and Regulatory Policy. “While U.S. Travel may use this campaign to talk about travel being an ‘adventure’ or ‘serious business’ the reality is those adventures and business trips are already taxed too much, according to the Global Business Travel Association and Travelers United.”

The U.S. aviation industry and its customers are subject to 17 unique taxes and fees imposed by the federal government. In fact, passengers pay $63 in federal taxes and fees on a typical $300 domestic one-stop, round-trip ticket, approximately 21 percent of the total cost. That’s real money that can mean the difference between a family vacation and a family “staycation.” This puts air travel in the same tax bracket as so-called “sin” products – alcohol and tobacco – which are taxed to discourage use. If U.S. Travel and the airports get their tax increase, a family of four taking one round trip could expect to pay up to $136 just in airport taxes – $64 more, taken directly out of the pockets of American families.

The push to increase the Airport Tax comes at a time when airport funding is plentiful. Since 2008, over $70 billion of airport capital projects have been completed, are underway or approved by U.S. airlines and their airport partners at the 30 largest airports without any increases in the PFC. In addition, U.S. airports currently hold more than $11 billion dollars in unrestricted cash.

“At a time when travel is taxed too much, airports have investment-grade credit, are financially sound and have ample access to the bond market to raise money. There is no crisis, and no need for a tax hike on airlines and their customers,” concluded Pinkerton.

ABOUT A4A

Annually, commercial aviation helps drive $1.5 trillion in U.S. economic activity and more than 10 million U.S. jobs. Airlines for America (A4A) vigorously advocates on behalf of the American airline industry as a model of safety, customer service and environmental responsibility and as the indispensable network that drives our nation’s economy and global competitiveness.

A4A works collaboratively with the airlines, labor groups, Congress and the Administration to improve air travel for everyone.

For more information about the airline industry, visit our website airlines.org and our blog, A Better Flight Plan, at airlines.org/blog.
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