Tags: airport | tax | passenger facility charge | pfc | congress

Congress Shouldn't Gouge Flyers by Increasing the Passenger Facility Fee

Congress Shouldn't Gouge Flyers by Increasing the Passenger Facility Fee
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Friday, 09 August 2019 11:49 AM Current | Bio | Archive

Everyone who’s visited an airport in the last 10 years knows that the experience could be better. The question is, what’s the best way to improve that?

Congressional Democrats — and one errant Kentucky Republican — have the exact wrong solution.

As part of a larger effort to upgrade our nation’s airports, Democrats on Capitol Hill are championing a regressive tax on airline passengers: a tax hike — folded into the price of a ticket — that would burden air travelers with additional hefty fees nationwide.

The surprising thing is not that Democrats support this extra tax; it is that a prominent member of the otherwise reliable Kentucky Republican delegation is giving strong consideration to joining his colleagues on the Democratic side.

The member in question is Rep. Thomas Massie (R-KY), who has won reelection since 2012 by campaigning to reduce the size and scope of government while lowering taxes. Such a move to side with Democrats to increase taxes could potentially draw the dismay of U.S. Senator from Kentucky and Senate Majority Leader Mitch McConnell, who has often used his powerful perch to beat back the kind of efforts Congressman Massie is currently weighing.

The passenger facility charge (PFC), a locally enforced but federally authorized fee that every passenger must pay at U.S. commercial airports, is currently set at $4.50 per person per flight segment.

The ideas being discussed in Washington transportation circles would allow airports to charge passengers as much as $8.50 per flight segment, with the option to increase the amount each year to match inflation. Others have floated removing the cap altogether.

The effort to increase the PFC is being led in the U.S. House of Representatives by Congressmen Peter DeFazio (D-OR), Chair of the House Transportation and Infrastructure Committee.

On several occasions, DeFazio has stated that by raising this tax, airports will be more equipped to fund infrastructure improvements to meet the laudable goal of “improving the passenger experience for millions of travelers.”

Congressional Republicans have historically been opposed to raising taxes on consumers to fund governmental projects.

Ranking Member Rep. Sam Graves, for one, has resisted efforts to increase to the PFC: “I am skeptical of any proposal that adds to the traveling public’s burden, fails to fully consider the views of local communities and passengers, and lacks a full range of financing options, including private capital.”

Opposition to increased fees remains strong off the Hill, with groups like the National Taxpayers Union and Americans for Tax Reform pointing to the recent surge in airport revenue and construction projects. Since 2008, America’s 30 largest airports have dedicated $70 billion on infrastructure improvements while enjoying a revenue increase of 52% since 2000, outstripping the consumer price index, which rose only 35% in the same time period, Americans for Tax Reform President Grover Norquist wrote in a letter sent to members of Congress.

“Given this period of prosperity, it is puzzling that airports are now pleading poverty and asking passengers to pay more,” he wrote.

Numbers from the 2019 Budget and Economic Outlook Congressional Budget Office report show that airports currently possess a cash balance of $14 billion in the Airport and Airway Trust Fund, a number that the CBO expects to grow to $56 billion by 2029.

Others have argued that this tax — like most — will be particularly burdensome on low income passengers. An increase in the PFC won’t affect limousine liberals who fly to climate change conferences in private jets, but it will hit the people who fly the least, increasing flying costs, reducing the number of airline passengers, and cutting the number of airline flights, according to the American Consumer Institute.

If this tax increase were to be implemented, it would likely come as part of the infrastructure investment deal currently being negotiated between Democratic leadership in Congress and the Trump administration. A rise of only four dollars may not sound like much, but remember that every tax increase in history has been couched in the smallest possible terms. When we buy plane ticket online, gobs of hidden fees appear between the listing and the final purchase.

Where needless airline fees are concerned, the sky will always be the limit.

Jared Whitley is a long-time politico who has worked in the U.S. Congress, White House, and defense industry. He is an award-winning writer, having won best blogger in the state from the Utah Society of Professional Journalists (2018) and best columnist from Best of the West (2016). He earned his MBA from Hult International Business School in Dubai. To read more of his reports — Click Here Now.

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Where needless airline fees are concerned, the sky will always be the limit.
airport, tax, passenger facility charge, pfc, congress
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2019-49-09
Friday, 09 August 2019 11:49 AM
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