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Profiteering From "taxes And Charges"  
User currently offlineABpositive From Australia, joined Nov 2005, 226 posts, RR: 0
Posted (7 years 9 months 3 weeks 1 day 13 hours ago) and read 2839 times:

I know that there are various fees and taxes associated with an airplane ticket (to cover for airport fees, government taxes, fuel surcharge, etc). Now that amount doesn't seem to vary regardless of how many passengers there are on the flight. When route gets up/down graded to a different sized aircraft the taxes don't change either. So what happens when the amount of those "taxes and charges" is less than what the airline collected from the passengers. Do they just pocket this? If so, how are the airlines regulated from profiteering from these "taxes and charges"?

Could someone enlighten me on how this system works

Many thanks,
ABpositive

4 replies: All unread, jump to last
 
User currently offlineAa757first From United States of America, joined Aug 2003, 3347 posts, RR: 8
Reply 1, posted (7 years 9 months 3 weeks 1 day 13 hours ago) and read 2836 times:

Government taxes should be refunded. Fees imposed by the carrier may or may not be refunded. This is the way it works, AFAIK.

AAndrew


User currently offlineMatt D From United States of America, joined Nov 1999, 9502 posts, RR: 47
Reply 2, posted (7 years 9 months 3 weeks 1 day 12 hours ago) and read 2807 times:

They're called "accessorial" charges. They are where the REAL money is at. No airline can make money selling tickets at posted prices. So they plump and push them up anywhere they can.

People are willing to pay $199 for a ticket +$75 in "fees, surcharges, and taxes".

People will be LESS LIKELY to purchase a ticket advertised at $274, even if it's all inclusive.

Yes, it's a money maker. But it's also about public perception. And most of all, it isn't at all limited to the airlines. The utility (check your monthly cell phone bill), trucking, car rental, cable, and other companies have been doing it for years.


User currently offlineAa757first From United States of America, joined Aug 2003, 3347 posts, RR: 8
Reply 3, posted (7 years 9 months 3 weeks 1 day 12 hours ago) and read 2807 times:

Quoting Matt D (Reply 2):

People are willing to pay $199 for a ticket +$75 in "fees, surcharges, and taxes".

It's illegal for an airline to exclude fees imposed by them. For example, I can advertise a fare for $99 that doesn't include a $10 airport usage tax, but I cannot advertise a fare for $99 that doesn't include a $15 ground service charge that the airline has imposed.

AAndrew


User currently offlineLeskova From Germany, joined Oct 2003, 6075 posts, RR: 70
Reply 4, posted (7 years 9 months 3 weeks 1 day 8 hours ago) and read 2742 times:

The taxes/charges levied on tickets are, for the largest part, published independant of the aircraft size used on a flight. No refunds if the plane is smaller or cheaper (which doesn't necessarily have to be 'smaller', but could also be 'quieter'), just as there aren't any extra invoices to pay if your flight is operated by something larger/more expensive than originally planned.

The taxes/levies/charges that are dependant on things like weight are usually calculated into the fare by the airline, and will usually be calculated at a type of average accross the types of aircraft used on a flight.

If you can find a route operated by several different types of planes, take a look at the taxes/fees charged on the different types: usually, you'll find out that the taxes are identical, regardless if the flight is operated by a B737, an A320, a B777, an A330 or whatever else.

As for the side-thread about what has to be advertized - here in Germany you have to list the price that's printed at the bottom of the ticket in the add, i.e. fare plus taxes/charges levied on the ticket itself (which is why LH will constantly advertize €99 fares throughout Europe, though you've got 0 chance of actually buying it at that price: ticketing/service charges charged by the website/travel agency/airline go on top of that, but those, too, have to be mentioned in the add).



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