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Posts with tag expedia.com

Are the airlines' extra fees cheating the U.S. out of tax dollars?

Filed under: Budgets, Debt, Tax, Transportation, Travel, Recession


The airlines might have found a tax loophole, and you're it. The travel consultancy firm T2 recently published a worrisome blog post that is gaining traction. The airlines' extra fees, it says, aren't just costing consumers more. They're also enabling the airlines to dodge tax to our government.

Until a few months ago, checking a bag was considered a service that came with the base fare that you paid when you bought your plane ticket. That was taxed at a rate of 7.5%. But now many airlines are charging up to $50 for each bag each way, and because it's not part of the base fare, that fee isn't subject to tax. T2 says that cash belongs to the airlines, free and clear.

So a carrier like United, T2 writer Timothy O'Neil-Dunne calculates, would be cheating Uncle Sam out of tax income of $7.5 million for each $100 million it makes on extra fees. Given that United recently surmised that it stood to make $700 million on its extra fees, that's a lot of cash that won't be going to our schools, our roads, our veterans programs, and our elaborate Wall Street bailouts. Not only do consumers get screwed by these extra fees, they get screwed out of the greater good of tax revenue.

Airlines tweak flight routes to battle fuel prices

Filed under: Budgets, Simplification, Transportation, Travel


You may not have thought there was anywhere else for the airlines to cut back. But, no. To cut costs, they have actually figured out a way to alter time and space.

Turns out that flight paths as we know them are less-than-efficient, and there are a few methods to wring more economy from the way planes fly on established routes. The airlines are already at it.

Method One: Flights get a little shorter. The International Air Transport Association (IATA) has estimated that in Europe, flights are about 30 miles longer than they have to be, mostly because jetliners have to avoid military airspace. Get the guys in green to ease up on peacetime airspace restrictions, and allow commercial pilots to make tighter turns (so hold on to those non-existent peanuts, folks). European flights could shorten by about four minutes if that happens. For the past year, American airlines have been permitted to use military airspace during peak travel periods like Memorial Day and Thanksgiving, but mostly to ease delays. It's not a leap to extend those permissions to help ailing airlines save a little more cash.