A4A Urges Lawmakers to Reject Unnecessary Tax Hikes on Airline Customers
February 12, 2018
WASHINGTON, February 12, 2018 – Airlines for America (A4A), the industry trade organization for the leading U.S. airlines, today urged Congress to reject increases to Transportation Security Administration (TSA) and Customs and Border Protection (CBP) security fees just as the administration rejected an unwarranted increase in the passenger facility charge (PFC), a move A4A strongly applauds. That said, Congress should prioritize efforts to return billions of dollars that were diverted from TSA and CBP to pay for non-aviation related purposes, rather than raise taxes on the traveling public as suggested in the administration’s 2019 budget proposal.
“Increasing taxes in any form will add to the cost of flying for millions of Americans, curtail job growth and limit the options small and medium communities currently enjoy,” said A4A President and CEO Nicholas E. Calio. “Billions of dollars have already been diverted from aviation security to go towards deficit reduction or other sectors of government. Congress should return this revenue to its intended purpose instead of raising TSA and CBP fees. Passengers already pay 21 percent in taxes on a typical domestic ticket and increasing them can’t be justified.”
Since 2013, approximately $1.3 billion per year in TSA fees are being diverted away from their intended purpose, which is to pay for aviation security screening. In addition, the 2015 highway bill diverted CBP fees to pay for highway spending.
Specifically, the administration’s fiscal year (FY) 2019 budget request proposes $2.9 billion annually over 10 years in new and higher federal aviation taxes and fees on the traveling and shipping public, including:
- TSA Passenger Security Fee Increase
The budget proposes to increase the passenger security fee by $1 per one-way trip in FY2019 and another $1.65 in FY2020, resulting in a total fee cost of $8.25 per one-way trip. The administration estimates that this tax hike will cost passengers an extra $2 billion annually.
- Immigration Inspection User Fee & Customs Fee Increases
The budget proposes an increase in the customs user fee from $5.65 to $8.40 and immigration user fee from $7.00 to $9.00. The administration estimates this will cost passengers over $900 million more annually.
A4A has consistently opposed tax increases that further burden consumers and risk discouraging air travel. In FY2017 alone, U.S. commercial aviation taxes and fees on airlines and their customers exceeded $24 billion – more than $66 million per day.