Last updated: 04:31 PM ET, Thu February 11 2016

Airlines for America Slams White House Air Travel Tax Hike

Airlines & Airports | Airlines for America | Josh Lew | February 11, 2016

Airlines for America Slams White House Air Travel Tax Hike

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Airline trade association Airlines for America has issued a statement that opposes a proposal by the White House to increase taxes on airlines starting during the 2017 fiscal year. According to A4A, American fliers already pay high taxes on air travel. Of the cost of an average flight, 21 percent goes to federal taxes. In the U.S., this adds up to a total industry-wide tax bill for airlines (and their passengers) of $22.6 billion per year. 

The new proposal from the White House would add an additional $7.9 billion onto that yearly total. Broken down into a per-flight percentage, the amount of federal tax collected for an average air journey would go from 21 percent to 26.5 percent. 

An unfair increase?

One of the major complaints voiced by the airline industry is that some of the money from the proposed tax increases would go towards paying down the government’s massive deficit. An A4A statement explained why the organization thinks the White House’s budget proposal is not only bad for the airline industry, but for the U.S. economy as a whole: 

“U.S. airlines are vital to the health of our nation’s economy, and the flying public should not be asked to foot the bill for deficit reduction. We urge Members of Congress to continue holding the line against unnecessary tax hikes that drive up the cost of travel for the 2 million passengers who fly on U.S. airlines every day.”

READ MORE: 6 Photos That Prove Air Travel Was Much Better in The '60s

Congress has sided with airlines thus far 

Thus far, Congress has “held the line” and sided with airlines (and with the flying public). For example, a previous proposal by the Obama Administration sought to nearly double the airport tax. That idea was shot down by the House and Senate.

Some of the money from this proposed tariff would have been put back into airport improvements. However, the argument against this was that airports have other means of income and financial support and this extra tax was unnecessary. Congress agreed with this stance and voted down the plan.  

More than one tax proposed 

In addition to the 2017 passenger tax, the latest Administration budget includes other fee increases associated with air travel. The budget calls for a $1 per one-way flight increase in the security tax, with an additional dollar added by 2020. Also, both customs and immigration taxes would be raised by $2 each (from $5.50 to $7.50 and $7 to $9 per passenger respectively). These two fee increases alone could cost the industry more than $1.5 billion annually.   

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