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Airlines are taking savings from expired taxes

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DALLAS (AP) — Airlines are tossing consumers aside and grabbing the benefit of lower federal taxes on travel tickets. By Saturday night, nearly all the major U.S. airlines had raised fares to offset t . . . (flightaware.com) עוד...

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xmacfly
ALLEN McLEAN 0
"Airlines tossing customers aside"? Well passengers are the enemy aren't they?
Fleagle
Fleagle 0
Bean Counter's Heaven . . . Centerstage.

An ill wind, forboding,'uncharted' waters for this ... America,et al.
"Busyness";agitation;conflict;anxiety;confusion;frustration.
Stay healthy- 'detach' as much as possible...if you can.
mpradel
Marcus Pradel 0
You can't have it both ways!
First, you want airlines to advertise the full price, inclusive of taxes & fees. And now you want the option to not pay the full fare?
Airlines need to make money in order to pay the wages the unions demand..
altstiff
Al Stiff 0
It's just a grab. If ASA and Virgin can pass the saving on why can't the others?
upchucked
C. WESLEY GRADY 0
Marcus, are you serious? Imagine for a moment that all gasoline taxes were to expire tomorrow. The $4.00 gallon you were going to buy, is now light by $150 on taxes. The station can sell it to you for $2.50 and still make the same profit they were going to make, but... they charge you the $4.00 and just put the extra money in their pocket and hope you won't notice the difference.

I will note that my favorite airline, my frequent flyer 'partner'..Alaska Airlines is giving the money back. I would bet that if every other airline gave it back, Delta would still take the money and run....
yock
Michael Yockey 0
Businesses will, and in fact they *should*, charge customers what the market will bear for a good or service. This is what begets healthy competition and supports the market participants. This can be only a good thing. Companies that have been struggling amidst raging fuel prices and reduced travel demand are getting a much needed boost in revenue that costs the consumer absolutely nothing.

That being said, if there are market participants who can afford to not take the revenue boost, they're certainly going to win customers with the lower prices. It'll be exciting to see what happens with this over the coming weeks.
upchucked
C. WESLEY GRADY 0
"Companies that have been struggling amidst raging fuel prices and reduced travel demand are getting a much needed boost in revenue that costs the consumer absolutely nothing."

What? Of course it costs the consumer. These are TAX monies that are not being collected and sent to the taxing authority. This is not a boost in income, it was never intended to go to the airlines and they are taking money that was never intended for them. That, is called unjust enrichment. My only regret is that I have retired and won't be the attorney who starts the class action suit. Mark my words, the money will come back to the consumers. My advice, if you are flying during this period, hold on to your ticket stub and boarding pass, you may need it to recover your money once the suit is over.
flyamav
Jane Toskes 0
A number of years ago the FET (federal excise tax of 7.5% of the ticket price and $3.70 per leg)on airfares expired, but was reinstated a short time later. But it was RETROACTIVE to the date it expired. So the airlines had to pay all that tax. I would not be surprised if the same thing happens again. Where will the airlines who are not collecting the tax get the money to pay the IRS?
upchucked
C. WESLEY GRADY 0
Under the law, the airlines are not allowed to collect the taxes, since the enabling legislation has lapsed. Making it retroactive won't work in this case, because the airlines couldn't collect the tax. They might punish those airlines who collected more than the permitted ticket price based on the filed tariffs, which I happen to think is a great idea.
dbaker
Daniel Baker 0
@upchucked -- what would they be punished for? raising their prices in a free market?
upchucked
C. WESLEY GRADY 0
They (the airlines) are required to file a tariff with the ARC (Airline Reporting Corporation) setting forth their fares, the rules that go with the individual fares and any restrictions. If you ever want to have a boring day, ask an airline to send you their filed tariff for a particular routing. Once filed, it is the "law" that ARC looks at when deciding whether or not an airline is doing what it says, and if you have a complaint about fares or denied boarding or refunds or whatever, that is the document that will decide it. I am certain that the tariffs filed by the airlines does not contain the higher fare by reason of the expired tax authorizations.
yock
Michael Yockey 0
@Grady: You're paying exactly the same now as you were prior to the retirement of the tax. I'm sorry you feel entitled to the return of those moneis, but the fact remains that this is not how the market works. Airlines weren't going to charge less for their product in the absence of this tax because they're already charging the maximum the market will allow without reducing their revenues. It just so happens that a percentage of the total fare amount has now been freed up for them whereas before the government claimed it.

I'd rather pay this amount to an airline than let the government squander it.
upchucked
C. WESLEY GRADY 0
Michael, repeat after me, "Unjust Enrichment"..... definition: A benefit by mistake or chance. Morally and ethically the one who gains a benefit for which he or she neither paid for, nor expended effort, should not retain the benefit to the detriment of the rightful owner.

The airlines have done nothing to earn or justify keeping this money, and morally and ethically, and in my opinion legally should return it. I am sure that this will happen by someone starting a class action, and the airlines will not only pay back the money, they will end up paying millions in legal fees and court costs. Greed has it's own consequence.
kb9uwu
Matt Comerford 0
wait, this isn't the unions fault? bahaha
flashgorman
Tom Gorman 0
You guys are getting all political, when the discussion should be one of ethics. The airlines who raised their ticket prices did so hoping that no one would notice. They are unethical.
rumples
James Wettermark 0
I am sooo tired of people lambasting the Government at every opportunity. I am an Intrument rated pilot who flies his own plane about 20-30 hours a month. I think the FAA and air traffic control do a great job. I realize my safety is often partly in their hands. I think my trust is well placed. The Government is squandering this tax money. They use it to create and maintain the best air traffic control system in the world.
upchucked
C. WESLEY GRADY 0
What? "Squandering this tax money.... they use it to create and maintain the best air traffic control system in the world."

I think you meant they are NOT squandering this tax money, yes? And, I happen to agree with you 100%. The scariest time I have ever spent in the air was just after Reagan fired the controllers.
rumples
James Wettermark 0
Oops. Yes. "NOT squandering"
benno5555
Benno Vyfvinkel 0
You guys are all super cheapskates! Profit margins for airlines are so low, all employees are underpaid. Hundred of pilots qualify for food stamps. Ticket prices compared to every other industry are fantastic -- for you-- and should be 10 ti mes higher to be at par. May you get the pilot you deserve, Ice up your wings, stall, and have him untrained on recovery! I"ll visit your widow when she gets horney
upchucked
C. WESLEY GRADY 0
If the airlines want more money, they can revise their tariff and raise the ticket prices. They have no right to keep tax money that was collected without authorization. Benno,the word is "Ethics".
flashgorman
Tom Gorman 0
WOW benno. Just wow... Any business is intent on prying money out of my wallet, and my job is to keep it. That doesn't make me a cheapskate. May you always have a safe flight wherever you go.
sbirch
sbirch 0
Oh how quickly we all forget that taxpayers bailed out the airlines after 911, yet they are taking every opportunity to use this situation to their advantage. Unethical, definately, unjust enrichment, we will see what the Court has to say - as this will surely end up there and is a valid legal argument. This is just another case where aviation is given a black eye, and for that we should all be angered.

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