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The Government is Playing Hide and Seek With Airfare Taxes

When purchasing a product or service, we all like to see the itemized list of charges – one that separates the cost of the purchase from the share going to Uncle Sam through the form of taxes and fees.  Needless to say, government bureaucrats don’t like that.  They desire that we remain blissfully ignorant of government’s burden on our everyday lives.  This is one reason why they concocted the withholdings scheme for income tax collection.  Now, they are expanding their tentacles into commercial taxes so they can obfuscate the magnitude of taxes and fees on airfare purchases.

Without much fanfare, the Department of Transportation (DOT) enacted a rule which requires airlines to ensconce all government taxes and fees in a single total advertised price with the fare.  For example, if you purchase a $350 plane ticket with $50 of taxes and fees, the DOT is demanding that the airline advertise the price as $400.  Airline passengers pay over a dozen taxes and fees on any given airplane ticket, but the government doesn’t want us to know that.  The rule was finalized last April, but only took effect last week.

The timing of this rule is very fortuitous.  This week, Congress will finalize negotiations for a long-term FAA funding bill.  This bill authorizes the collection of all taxes – including taxes on aviation fuel, domestic and international ticket taxes, and cargo –directed to the Airport and Airway Trust Fund, which provides the bulk of FAA funding.  As usual, Democrats want to spend more money on wasteful projects, and are all too hungry to increase aviation taxes.  What better way to leverage tax increases than by forcing airlines to hide their cost and to shoulder the blame for the perceived higher price tag at the top!

This is yet another insidious plan to raise taxes and place unconstitutional mandates on private enterprise – all by administrative fiat.  It must be stopped in its tracks.  Today, conservative Rep. Tom Graves (R-GA) is introducing a bill, the Travel Transparency Act, which will void the DOT rule, and demand that passengers have the right to view all the aviation taxes in separate line items for each ticket purchased.  Graves asserted that “the federal government should not be inserting itself in the private sector to limit consumers’ ability to see how much they’re getting taxed. If the American people can’t see these costs clearly, I fear it will be easier these fees and taxes to be raised without their knowledge.”

Secretary of Transportation Ray LaHood, who used to be a Republican, defended the rule as a necessary means to ensure that passengers are treated with “dignity and respect.”  The only thing this rule will accomplish is ensuring that passengers retain their “respect” for government, while blaming the airlines for perceived increases in ticket prices.

At present, airline passengers are on the hook for at least 16 different taxes and fees on the average airline ticket.  Additionally, they must incur the most harmful backdoor tax; the high cost of jet fuel resulting from decades of anti-energy growth policies.  We must ensure that the existing taxes remain transparent so that Congress will have a harder time sneaking through new tax increases.  Please ask your member of Congress to cosponsor Tom Graves’s Travel Transparency Act.

Cross-posted to The Madison Project

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