And though she will mess up your like, you’ll want her just the same. And Now I know, She has a built in ability to take everything she sees sang Genesis in the title track to their most successful album. And take everything she sees is just what the federal government is doing to airline passengers though massively high excise and facilities taxes. And now, they are forcing the air carriers to hide the fact that taxes and government imposed fees can make up more than half of the price of airline tickets.
One of the principles of a good tax, and identified by the National Conference of State Legislatures (NCSL) is that the tax should not be hidden. (www.ncsl.org/documents/fiscal/TaxPolicyHandbook3rdEdition.pdf) By forcing airlines to include the taxes in their list prices the federal government is making them hide the fact that most of the cost of a given flight is due to exorbitantly high taxes.
The federal government levies a 7.5% tax on the base ticket price; a tax of $3.80 per person per segment; a $2.50 per flight “September 11th Security Fee” and a tax of $8.20 for flights to or from Alaska and Hawaii. In addition, the Federal government levies taxes of $28.80 on all international flights coming to the country and $16.80 on flights leaving. These taxes pale in comparison to some international taxes which can be as high as $350 (which is why it costs half as much to fly to Buffalo than Toronto).
In addition to all of these taxes, individual airports levy fees of up to $4.50 per person for what are called Passenger Facility Charges.
Traditionally, airlines have advertised their fees without these taxes included and have added them in upon purchase – just like retailers add in sales taxes at the register. However, last week the Department of Transportation put into effect new rules that require airlines to advertise their prices with all fees included. Forcing companies to hide government taxes in their prices is one way that the government has traditionally worked to ensure that the scope and reach of tax policy is hidden.
In many states, gas stations cannot display the percentage of the cost of fuel that comes from taxes and tobacco companies have been restricted from providing consumers with information on the fact that taxes equate to over 50% of the cost of their products. These restrictions exist only to turn consumer anger over high prices onto producers and away from the governments that are actually responsible for the expense.
While nobody would like to see companies spring fees onto customers after the fact, this was not the case with the airline industry. Even without this rule, taxes and fees were already disclosed at purchase. And even though the rule allows airlines to break out these fees on tickets or at purchase, forcing companies to include taxes in their pricing is a step toward eventually hiding the taxes completely.