Different taxes on same award ticket? [OneWorld]
Sep 27, 2016, 9:49 am
#16
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Looks like they don't charge the $4.50 Passenger Facility Charge but they do charge the $17.80 U.S. International Departure tax on this one-way from JFK to LHR (see $5.60+$17.80 = $23.40). Award departures from the USA should only have $5.60 tax, assuming no YQ.
Last edited by wiivile; Sep 27, 2016 at 9:56 am
Sep 27, 2016, 10:00 am
#17
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My recent experience in looking at DL award tickets to GIG is that total taxes and fees were significantly lower if the ticket was booked as two one ways rather than a RT.
Sep 27, 2016, 10:19 am
#18
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IME with AA awards, if there is no YQ, a one way nonstop award out of US should be charged only $5.60 as the international departure tax does/should not apply. I'm assuming a US-based airline would know the applicability of US aviation taxes better than a foreign carrier.
Sep 27, 2016, 10:24 am
#19
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IME with AA awards, if there is no YQ, a one way nonstop award out of US should be charged only $5.60 as the international departure tax does/should not apply. I'm assuming a US-based airline would know the applicability of US aviation taxes better than a foreign carrier.
Sep 27, 2016, 10:27 am
#20
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I agree. No U.S. airline charges anything other than $5.60 for U.S.-originating awards (unless there is YQ or the destination country charges an arrival tax). The fact that foreign airlines (JAL, Iberia, and FlyingBlue just from this thread) are collecting unnecessary U.S. taxes is troubling to me, but not sure how to get them to stop.
Sep 27, 2016, 12:17 pm
#21
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I agree. No U.S. airline charges anything other than $5.60 for U.S.-originating awards (unless there is YQ or the destination country charges an arrival tax). The fact that foreign airlines (JAL, Iberia, and FlyingBlue just from this thread) are collecting unnecessary U.S. taxes is troubling to me, but not sure how to get them to stop.
A complaint about the practice to the DOT might or might not put pressure on JL to fix this.
A few years ago, BA was improperly collecting some taxes on AA award flights between North and South America -- award flights that have no YQ. BA eventually fixed this.
Sep 27, 2016, 1:20 pm
#22
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FlyingBlue definitely does this. I recently booked 2x one way tickets on the exact same J/D1 flights RDU - ATL - LHR (all DL metal) with 1 ticket booked through DL and the other through FB (booked at the exact same time to make sure we both got on the flight).
The one booked with DL miles was $5.60 while the one booked with FB miles was ~$23 (as listed above though the charge was in Euros). Didn't bother pursuing but it definitely happens - not sure what there is to do about it. I think they probably know it happens but figure most people are like me and are pleased with getting a TATL D1/J flight for ~$23 + miles that they don't both pursuing the overcharging on taxes which they likely pocket directly.
The one booked with DL miles was $5.60 while the one booked with FB miles was ~$23 (as listed above though the charge was in Euros). Didn't bother pursuing but it definitely happens - not sure what there is to do about it. I think they probably know it happens but figure most people are like me and are pleased with getting a TATL D1/J flight for ~$23 + miles that they don't both pursuing the overcharging on taxes which they likely pocket directly.
Sep 27, 2016, 2:05 pm
#23
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Well, yes, it would be strange if "US International Departure Tax" and " US International Arrival Tax" were collected on flights from New York to boston.
Also, these taxes are not part of the title 49 section of the code earlier cited, but rather the Internal Revenue Code, section 4261, which is not as straightforward as title 49 in terms of when it applies. But if you want to get your mind in knots: https://www.irs.gov/pub/irs-wd/1002004.pdf
Also, these taxes are not part of the title 49 section of the code earlier cited, but rather the Internal Revenue Code, section 4261, which is not as straightforward as title 49 in terms of when it applies. But if you want to get your mind in knots: https://www.irs.gov/pub/irs-wd/1002004.pdf
Last edited by Adam1222; Sep 27, 2016 at 2:22 pm
Sep 27, 2016, 2:14 pm
#24
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Well, to be fair, Iberia is improperly charging the $4.50 Passenger Facility Charge (both ways) on domestic award itineraries too, so it's not just international itineraries that foreign airlines are collecting unnecessary taxes.
Sep 27, 2016, 3:27 pm
#25
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Well, yes, it would be strange if "US International Departure Tax" and " US International Arrival Tax" were collected on flights from New York to boston.
Also, these taxes are not part of the title 49 section of the code earlier cited, but rather the Internal Revenue Code, section 4261, which is not as straightforward as title 49 in terms of when it applies. But if you want to get your mind in knots: https://www.irs.gov/pub/irs-wd/1002004.pdf
Also, these taxes are not part of the title 49 section of the code earlier cited, but rather the Internal Revenue Code, section 4261, which is not as straightforward as title 49 in terms of when it applies. But if you want to get your mind in knots: https://www.irs.gov/pub/irs-wd/1002004.pdf
(c) Use of international travel facilities
(1) In general
There is hereby imposed a tax of $12.00 on any amount paid (whether within or without the United States) for any transportation of any person by air, if such transportation begins or ends in the United States.
(2) Exception for transportation entirely taxable under subsection (a)
This subsection shall not apply to any transportation all of which is taxable under subsection (a) (determined without regard to sections 4281 and 4282).
(3) Special rule for Alaska and Hawaii
In any case in which the tax imposed by paragraph (1) applies to a domestic segment beginning or ending in Alaska or Hawaii, such tax shall apply only to departures and shall be at the rate of $6.
There is hereby imposed a tax of $12.00 on any amount paid (whether within or without the United States) for any transportation of any person by air, if such transportation begins or ends in the United States.
(2) Exception for transportation entirely taxable under subsection (a)
This subsection shall not apply to any transportation all of which is taxable under subsection (a) (determined without regard to sections 4281 and 4282).
(3) Special rule for Alaska and Hawaii
In any case in which the tax imposed by paragraph (1) applies to a domestic segment beginning or ending in Alaska or Hawaii, such tax shall apply only to departures and shall be at the rate of $6.
Up until two years ago, CX awards (JFK-HKG-JFK) when redeemed with AA is $0 fare. No US Departure/Arrival Tax. All this time the HKG Security Surcharge was being absorbed for CX.
At some point since then, CX decided to pass on the Security Surcharge to award passenger triggering a YQ of $6. AA started tacking on US Arrival Tax for HKG-USA oneway and both US Departure/Arrival Tax for US-HKG roundtrips.
Sep 27, 2016, 6:00 pm
#26
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Refer to 26 USC §4261(c)(1). Interesting that even IRS is referring you to Cornell's website for the IRS code.
According to US-based airlines, $0 fare is not considered "any amount paid." No Departure/Arrival Tax. If YQ is charged, this gets triggered.
Up until two years ago, CX awards (JFK-HKG-JFK) when redeemed with AA is $0 fare. No US Departure/Arrival Tax. All this time the HKG Security Surcharge was being absorbed for CX.
At some point since then, CX decided to pass on the Security Surcharge to award passenger triggering a YQ of $6. AA started tacking on US Arrival Tax for HKG-USA oneway and both US Departure/Arrival Tax for US-HKG roundtrips.
According to US-based airlines, $0 fare is not considered "any amount paid." No Departure/Arrival Tax. If YQ is charged, this gets triggered.
Up until two years ago, CX awards (JFK-HKG-JFK) when redeemed with AA is $0 fare. No US Departure/Arrival Tax. All this time the HKG Security Surcharge was being absorbed for CX.
At some point since then, CX decided to pass on the Security Surcharge to award passenger triggering a YQ of $6. AA started tacking on US Arrival Tax for HKG-USA oneway and both US Departure/Arrival Tax for US-HKG roundtrips.
Yes I linked to subregulatory guidance that goes into this in more detail than the U.S.C. Cornell's LII is generally the easiest place to read the U.S. Code (all titles) for free on the internet.
Last edited by Adam1222; Sep 28, 2016 at 9:35 am
Sep 28, 2016, 9:00 am
#27
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This may have to do with the fact that Brazil has some airline regulations that prohibit certain fees for flights originating in Brazil. Not sure of the all details here, but it certainly does not apply on flights US - Europe. If you book that as two one ways Delta will charge YQ on the trip originating in Europe.
Oct 26, 2016, 9:45 pm
#28
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Refer to 26 USC §4261(c)(1). Interesting that even IRS is referring you to Cornell's website for the IRS code.
According to US-based airlines, $0 fare is not considered "any amount paid." No Departure/Arrival Tax. If YQ is charged, this gets triggered.
Up until two years ago, CX awards (JFK-HKG-JFK) when redeemed with AA is $0 fare. No US Departure/Arrival Tax. All this time the HKG Security Surcharge was being absorbed for CX.
At some point since then, CX decided to pass on the Security Surcharge to award passenger triggering a YQ of $6. AA started tacking on US Arrival Tax for HKG-USA oneway and both US Departure/Arrival Tax for US-HKG roundtrips.
According to US-based airlines, $0 fare is not considered "any amount paid." No Departure/Arrival Tax. If YQ is charged, this gets triggered.
Up until two years ago, CX awards (JFK-HKG-JFK) when redeemed with AA is $0 fare. No US Departure/Arrival Tax. All this time the HKG Security Surcharge was being absorbed for CX.
At some point since then, CX decided to pass on the Security Surcharge to award passenger triggering a YQ of $6. AA started tacking on US Arrival Tax for HKG-USA oneway and both US Departure/Arrival Tax for US-HKG roundtrips.
The IRS memo seem to suggest whether the international facilities charge (departure/arrival tax) applies in §4261(c) is dependent on whether the award miles are taxable under §4261(a). Under certain circumstances, they may or may not be taxable.