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Wednesday, November 27, 2013

Airlines Oppose Tax Hikes

Woodrow Bellamy III

Airline industry trade groups are opposing a proposed tax increase included in the House and White House budget proposals that would double the Transportation Security Administration (TSA) passenger security tax on airline tickets from $2.50 to $5. 
Airlines for America (A4A), the Air Lines Pilots Association (ALPA) and International Air Transportation Association (IATA), among others, sent a joint letter to House Budget Committee Chairman Paul Ryan (R-Wis.) and Senate Budget Committee Chairwoman Patty Murray (D-Wash.) urging lawmakers to reject any increase in the TSA passenger tax.
The letter points out that the tax and fee burden on air travel has increased significantly over the last two decades, from $3.7 billion in 1993 to $19 billion in 2013. 
“Doubling the TSA passenger security tax would cost passengers more than $730 million annually," said Nicholas Calio, president and CEO of A4A. 
Calio also noted that U.S. airlines paid a combined $19 billion in taxes in 2013, and on average, $61 of a typical $300 domestic round-trip ticket goes toward federal taxes. 

"Higher taxes make airfare more expensive and dampen demand. According to a report by the nonpartisan Government Accountability Office (GAO), every dollar increase in the price of a ticket reduces the demand for travel by as much as 2 percent," Calio wrote in a recent op-ed article. 

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