Hidden in the cost of airline tickets are government add-ons for everything from security fees to airport departure taxes.
Those charges can be substantial, but passengers may not be aware that they exist. However, a new bill introduced in Congress would require airlines to list all government fees in their airfare advertisements, to make the cost of flying more transparent.
The legislation would reverse U.S. Department of Transportation regulations enacted two years ago that changed the way airlines advertised their fares. Currently, the government fees are lumped together with the base airfare to reflect the overall ticket cost.
Sponsors of the new legislation want all government-imposed fees broken out separately from the airfare to give passengers a full picture of the cost of their ticket.
"We need transparency so that people know exactly what they're paying for," U.S. Rep. Frank LoBiondo, one of the sponsors of the bill, said in an interview Monday. "People may mistakenly think that the airlines are taking it all."
LoBiondo, R-2nd, predicted the bipartisan legislation will win House approval but was unsure whether the Senate would be receptive.
"The Senate is unpredictable," said LoBiondo, who serves as the chairman of the House Aviation Subcommittee.
The airline industry is lending its support for the new legislation. Airlines for America, an industry trade group, argues that the USDOT's current regulations unfairly prohibit the airlines and travel agents from fully disclosing all of the government charges, "thereby masking the excessive federal tax rate on the cost of air travel."
"It's a misnomer to characterize the current law as a consumer protection rule when it really protects the government, not airline passengers, and it's disingenuous for Washington to hide the ball and not be held responsible for the taxes they impose on air travel," Nicholas Calio, president of Airlines for America, said in a statement.
Government fees already make up a sizable portion of ticket costs and will go even higher starting this summer. For instance, passengers currently pay $61 in federal taxes on a typical $300 round-trip domestic ticket, according to Airlines for America.
In July, the government's charge will increase because the Transportation Security Administration fee for airport security will more than double - from $2.50 to $5.60 per one-way trip - to generate more than $1 billion in annual government revenue, industry figures show.
The White House budget proposal would increase other government aviation fees. Under that scenario, there would be a $2 increase in the customs fee, a $2 increase in the immigration fee and a $3.50 increase for the so-called passenger facility charge, the departure tax that airports impose on travelers to raise money for construction projects.
Other congressional members who joined with LoBiondo to sponsor the legislation issued a statement saying that their bill would "ensure that airfare advertisements are not forced to hide the costs of government from consumers."
They said the USDOT apparently had good intentions when it approved the current regulations two years ago, but what actually occurred was even less transparency in ticket prices.
"The cost of airline tickets will never be transparent as long as the Department of Transportation requires airlines to hide taxes, surcharges and fees from consumers," said U.S. Rep. Tom Graves, a Georgia Republican. "In fact, this regulation means airlines may unfairly shoulder the blame for price increases, even if it's a government tax hike that's responsible."
When the USDOT stepped in two years ago, its regulations were supposed to let airline passengers know the true cost of their tickets. Before then, airlines could obscure the total ticket price by using fine print or disclaimers in their ads to denote government fees or taxes. The USDOT required that the full cost of the ticket had to be revealed in airfare ads, but it did not compel airlines to separately break out the government fees.
Sponsors of the new legislation maintain that the USDOT simply did not go far enough to protect consumers. They said the department unwittingly added to the secrecy of airfare ads by not requiring a breakdown for government fees. Calling for full disclosure, they said their bill is a common-sense way to fix any flaws in the current regulations.
"Department of Transportation regulations have fundamentally and unfairly changed the advertising rules for airfares by requiring all government-imposed taxes and fees to be embedded in the advertised price of a ticket," said Rep. Bill Shuster, a Pennsylvania Republican. "As a result, the fact that Americans are paying higher and higher government-imposed taxes and fees to travel by air is being hidden from them."
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