White House Budget Proposals May Shift More Fees to Passengers

How much is too much for airfare, and when will passengers cry uncle? The airline industry could find out if new budget proposals sent to Congress are approved – coupled with ever-increasing ticket prices.

Why One Airline Hates New ‘Transparent’ Fee Rules

New Fees – What Passengers May Have to Pay

These budget proposals have been kicking around for a while, but now more of the details are available:

Security: Airlines and passengers would pay up to $32 billion in new fees for air traffic and security improvements over the next decade.

  • Potential passenger payout: This could double the one-way ticket security fee to $5 next year and then rise to a high of $7.50 by 2018.

Traffic Control: Airlines would pay a $100 departure fee per plane to raise more than $7.4 billion in the next 10 years to help cover costs of upgrading air traffic control.

  • Potential passenger payout: Unclear. However, it seems all but certain that airlines would raise airfares to pass these costs along.

See the Airline Taxes/Fees You Have to Pay Right Now

Airports: Grants to fund medium and large airports would be cut by well over a third, with the near-billion dollar shortfall to be made up with additional airport fees.

  • Potential passenger payout: Unclear. Airports would be allowed to raise some ticket charges to collect revenue for airport construction projects.

Airlines Expected to Fight New Fees/Taxes

Airlines argue – with some justification – that they are the most over-taxed industry in the nation, while noting that no one bails them out like the auto industry when they need a hand (see American Airlines’ ongoing bankruptcy for a case in point).

Why Airfare to Europe is So High – and What You Can Do

On the other hand, the government says it wants to ease the tax burden of the American people. The only problem with that is, the airlines will likely push much of these new costs off on passengers, who – on domestic flights anyway – tend to be U.S. taxpayers.

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Published: February 13, 2012