Stay Home: Airfare Taxes Now 150% of Ticket Cost
I've been lucky for the past few years -- whenever I've traveled overseas, I've either been on someone else's dime (and there's no better way to travel than at someone else's expense) or I've been wily enough to deploy frequent flier miles.
Two things to know about me: 1) I'm fairly cheap about air travel. I hate the idea of paying to sit at the pointy end of the plane (other people, though, are welcome to pay for me; and in the case of speeches, etc. they're actually obligated to...) and I can fold myself up into an aisle seat in coach without too much trouble. And 2) I've always assumed that air travel taxes and fees are high, but that some law of physics commanded that they could never be higher than the cost of the ticket itself.
I was wrong. Checking out flights on kayak.com to London and back next month, I was directed to Orbitz.com where I came across this odd bit of economic distortion. Cost of ticket: $270.00. Taxes and fees: $441.00.
Checking through the "taxes and fees" popup window, I see that Orbitz tacks on a bunch of items: a "service fee and a "paper ticket processing fee" and the airlines add on a "baggage fee" but all of those are just $10 here and $19 there. They don't add up to $441.00.
Until I got to this part. The "Government and Other Authority taxes and fees" section:
Government and other authority taxes and fees:
September 11 Security Fee: A September 11 Security Fee of $2.50 USD applies per flight segment (maximum charge per trip--$5.00 USD one-way, $10.00 USD round-trip). A flight segment is defined as one takeoff and one landing.
Passenger Facility Charges: Passenger Facility Charges (PFCs) of up to $18.00 USD may apply, depending upon the itinerary chosen.
Federal Excise Tax: A 7.5% domestic tax applied to the airline base fare. The tax may be pro-rated for flights to/from the 48 contiguous U.S. states and Alaska and Hawaii, and some international destinations. A Travel Facilities Tax of $8.10 USD per direction also applies to flights to/from Alaska and Hawaii and the 48 contiguous U.S. states or between Alaska and Hawaii.
Federal Domestic Flight Segment Fee: A federal domestic flight segment fee of $3.70 USD applies per flight segment. A flight segment is defined as one takeoff and one landing.
U.S. or International Departure and Arrival Charges: U.S. or international departure and arrival charges of up to $200.00 USD may apply, depending upon the itinerary chosen.
That last one is really a kicker, right? "Up to" $200. To the government, or to the mysteriously vague and sinister-sounding "other authority."
That must be where the taxes and fees get turbocharged. Which is insane. And I fear the way of the future: taxes and fees -- especially hidden ones, from "other authorities", where you have to click a couple of times and scroll down the page to find out about -- are all going up, quietly, and without fanfare. Suddenly -- at least it's sudden to me -- the taxes and fees on a thing are one and a half times the price of the thing itself.
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May '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
Other authorities? Are NGO's now charging fees? We've come a long way since the Hari Krishnas.
Is this unique to the UK? They do make a lot of noise over there about sticking it to airlines in the name of Gaia, but didn't know if they had acted on that, or if they were still trying to find the key from the last time they handcuffed themselves to the chain link.
Jul '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
Rob, Gordon Brown instituted an Air Passenger Duty in order to "pay for carbon offsets" of air travel emissions. It varies, but you can count on being dinged for $120 to $200 any time you fly to, from, or within Great Britain.
Nov '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
I don't know what caused you to think that it was impossible for the taxes to be higher than the cost of a ticket. In Washington State, the amount of tax on a carton of cigarettes is about double the cost of the carton.
Sep '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
While I'm sympathetic to your point, the truth is that air travel is cheaper than ever in spite of these taxes. For the 11,000-mile trip you priced, it comes out to less than 7 cents per mile. When I was a poor student in the 1970s, traveling to Europe was a much more expensive proposition.
The fact is, there's been a steady decline in the cost of air travel since the 1920s. On a log scale, this decline has been constant with time, meaning the decline is exponential. Before you ask, airline deregulation in 1978 had no effect whatsoever on the shape of this curve. See data.
Nov '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
Although air travel may be cheap even with the taxes I would avoid air travel just to deny the government and the “other authority” the money. There is a moral principle involved in this.
There’s a Costco one-half mile from my house but it’s just over the line into a city where the total state and city sales tax reaches 9%. There is another Costco 14 miles from my house where the combined state and city sales tax is 5.9%. Guess which one I shop at. I don’t care that it make no economic sense to drive 28 miles round trip to save less than the gas cost in sales tax. It’s a moral issue. I don’t want to give money to thieves, and any sales tax in excess of 6% is theft.
Taxes and Fees in excess of the price of an airline ticket is grand theft.
Edited on Jan 24, 2011 at 10:42amAug '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
That took me over to Expedia to check out my latest itinerary, the taxes on a domestic flight were about 10% . I checked on a round trip from KC to London and it was 672 with taxes and the explanatory popup window didn't include some of your charges .
The alarming thing is that you pay only $39 more than I do, now if I could fly round trip to LAX from KC, that would be a deal.
Nov '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
At least the local taxing authorities for sales tax are stationary bandits. If they rob you of everything you have they can’t get any more out of you in the future. So they leave you with enough so you can recover and they can do it to you again.
The “other authority” is a roving bandit that won’t impose any such limitation on itself and will try to take everything you have.
May '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
I can see a parody advertisement in there somewhere... but unfortunately none of them are safe for work, let alone the Rico code. Let's just say it involves flying United....
May '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
drlorentz: While I'm sympathetic to your point, the truth is that air travel is cheaper than ever in spite of these taxes. For the 11,000-mile trip you priced, it comes out to less than 7 cents per mile. When I was a poor student in the 1970s, traveling to Europe was a much more expensive proposition.
The fact is, there's been a steady decline in the cost of air travel since the 1920s. On a log scale, this decline has been constant with time, meaning the decline is exponential. Before you ask, airline deregulation in 1978 had no effect whatsoever on the shape of this curve. See data. · Jan 24 at 10:20am
Nice data set. I crunched the numbers. The rate of decline fluctuates a bit, but it averages about a 2.6% real decline per year.
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
Thanks, Mark and drlorenz, for the statistical analysis! That's what I've come to expect from fellow Ricocheteers: actual knowledge, as opposed to my usual making-it-up-as-I-go-along.
And Kenneth, you're right -- it's a Gordon Brown thing that they really should abolish.
But still: shouldn't there be an immutable Law of Taxation that requires the taxes on anything to be less than the thing itself? I mean, in a perfect world? Or at least a rule that when I click on an airfare that says $400 it means, roughly, $400, and not $871, when taxes and fees are added in?
Or should I shut up and stop complaining?
May '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
Pan American inaugurated the world's first transatlantic passenger service on June 28, 1939, between New York and Marseilles, France, and on July 8 between New York and Southampton. Passengers paid $375 for a one-way trip across the ocean.
In today's dollars that's $5,724.63.
May '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
EJHill
In today's dollars that's $5,724.63. · Jan 24 at 1:14pm
Yeah, but they had real Catch Me If You Can stewardesses. And free drinks. And you could smoke.
Aug '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
And little fivepacks of cigarettes. And when you got to London, a martini was two bucks, instead of the sixteen I paid at the Ritz last month !
May '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
In 1939? I think the flight attendants were all registered nurses.
Jul '10
Re: Stay Home: Airfare Taxes Now 150% of Ticket Cost
Sorry, no playing "Strip Air Travel" on Ricochet.
Edited on Jan 24, 2011 at 5:15pm