The FY 2017 White House budget proposal includes a federal tax hike for airlines, which is estimated to cost air travelers as much as $7.9 billion per year, an increase of $22.6 million from 2016. As it stands, passengers pay $63 in federal taxes when booking a round-trip domestic ticket. Given the proposed tax hike, passengers would see an increase to $80 per ticket.
Airlines for America, an industry trade organization, spoke out against this proposed tax increase. “U.S. airlines are vital to the health of our nation’s economy, and the flying public should not be asked to foot the bill for deficit reduction. We urge Members of Congress to continue holding the line against unnecessary tax hikes that drive up the cost of travel for the two million passengers who fly on U.S. airlines every day,” the organization said in a statement earlier this month.
Other travel-related tax and fee increases the budget proposes include an annual increase of the security tax for one-way trips (eventually costing passengers and airlines an approximate $1.2 billion each year), a reinstating of the $420 million TSA Aviation Security Infrastructure Fee, an increase in customs tax from $5.50 to $7.50, an increase in immigration tax from $7 to $9 and a $10 per barrel oil tax (ultimately raising gas prices by 23.8 cents per gallon).
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