If Legislation Passes, Baggage Fees Could Disappear

Finding the cheapest airline tickets today means factoring in the cost of fees, including the despised checked luggage fees.

Since fees for checked luggage became popular in 2008, the number of checked bags has dropped by 20 percent. Consequently, the number of carry-on bags has increased by 50 percent in the same time period, representing 87 million more carry-on bags in 2011 than in 2010. But Senator Mary Landrieu (D-LA) has introduced two pieces of legislation that could change everything.

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The Proposed Airline Bills
One proposed bill, called the Airline Passenger Basic Airline Standards to Improve Customer Satisfaction (BASICS) Act, would ban airlines from charging for the first checked bag. The other proposed bill, the Fair Airline Industry Revenue (FAIR) Act, would allow airlines to keep the fees but would also raise taxes on the airlines that charge them, raising an estimated $260 million that the TSA would use to provide the equipment and manpower needed to screen all the extra carry-on bags more quickly.

Which Airlines Would be Most Affected?
All the legacy airlines – such as American, United and Delta – would be affected by the bill, because all charge for checked luggage. Southwest, JetBlue and Virgin America allow one free checked bag, and so they would feel less of an impact. Spirit Airlines, the only U.S. airline that charges for carry-on bags, would likely feel the biggest hit. Airline analysts say that if the fees for checked luggage were banned, fares would rise to make up for the losses and customers would end up paying higher excise taxes, which are based on fares rather than fees.

What Are the Chances the Bill Will Pass?
The U.S. Travel Association – which represents rental car companies, hotels and other travel-related industries – favors the bill, because they say that the current fees discourage travel. Trade groups in the airline industry oppose both bills. They say currently only about one-quarter of passengers pay for checked luggage due to using carry-on bags, choosing airlines without the fees, or paying with credit cards or frequent flier miles that waive charges for checked luggage.

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It is not yet clear whether this bill will gain any traction. On one hand, the bill could gain popular support as voters continue to deal with personal economic difficulties. If so, the 2012 election year could propel the bill further along than it would go otherwise. Landrieu herself isn’t up for reelection until 2014, so she would not need to use it to garner election year support yet. On the other hand, the 112th Congress has been notorious for turning every piece of legislation into a battleground. On that basis alone, travelers interested in cheap flights should probably not hold their breath hoping the bill will be passed any time soon.

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Published: December 22, 2011