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Old May 3, 2008 | 2:59 pm
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Fuel Tax

Does anyone know what kind of a fuel tax airlines pay in the US? It seems to me that instead of a federal gas tax holiday, the government out to consider reducing or waiving taxes on fuel for airlines--this could save airlines significant amounts of money, lower fares, etc...

I understand that with cars, the tax creates an incentive for people to use less gas; it strikes me that with airlines, they are going to use the same amount of gas regardless as their flight paths are more or less set (disregarding the occasional diversion).

Anyways, just a Saturday afternoon musing...
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Old May 3, 2008 | 3:06 pm
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The U.S. tax on aircraft fuel is zero - yes, zero. It is zero in (essentially) all countries by an old international treaty.
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Old May 3, 2008 | 3:07 pm
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Thanks for the info.
So much for my brilliant idea!
Looks like we'll all have to just grin and bear it.
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Old May 3, 2008 | 3:20 pm
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Airlines pay landing fees, which are used to maintain airport infrastructure. Gas tax that we pay at the pump is supposed to pay for roads, but it doesn't even cover maintenance.
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Old May 4, 2008 | 9:59 am
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Originally Posted by Palal
Gas tax that we pay at the pump is supposed to pay for roads, but it doesn't even cover maintenance.
I just wonder if what's allocated doesn't even cover maintenance? Or are road fuel tax revenues actually that low?
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Old May 4, 2008 | 10:31 am
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Originally Posted by aajones
Does anyone know what kind of a fuel tax airlines pay in the US? It seems to me that instead of a federal gas tax holiday, the government out to consider reducing or waiving taxes on fuel for airlines--this could save airlines significant amounts of money, lower fares, etc...

I understand that with cars, the tax creates an incentive for people to use less gas; it strikes me that with airlines, they are going to use the same amount of gas regardless as their flight paths are more or less set (disregarding the occasional diversion).

Anyways, just a Saturday afternoon musing...
why? airplanes are very full. the prices are too low. the cost of iad-den in 1978 was $300. today it is $269 plus fees. should be $1000 or so using 1978 dollars.

if airlines were saved money, they'd just waste it lowering prices.

why should not the price of air transport reflect the cost of the travel?
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Old May 4, 2008 | 11:01 am
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Originally Posted by YVR Cockroach
I just wonder if what's allocated doesn't even cover maintenance? Or are road fuel tax revenues actually that low?
Yes, it's that low. The federal gas tax has been 18.4c since 1983. If it were indexed for inflation (in general consumer prices) it would be 39.8c now. The cost of steel and concrete has skyrocketed in recent years.
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Old May 4, 2008 | 12:05 pm
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Originally Posted by slawecki
why? airplanes are very full. the prices are too low. the cost of iad-den in 1978 was $300. today it is $269 plus fees. should be $1000 or so using 1978 dollars.

if airlines were saved money, they'd just waste it lowering prices.

why should not the price of air transport reflect the cost of the travel?
I think that starts the free-market vs. govt intervention debate...I believe in free-market economics as much as Friedman, but in the case of air travel I have to say that I think the benefit of govt intervention in keep ticket prices down is probably best--if you extrapolate the dollar amount of commerce made possible by cheap air travel, I think you would find that it is well worth it (obviously I don't have any real figures, but I'm making an educated guess).

Furthermore, I don't think that your comparison of iad-den 30 yrs ago to today is completely qualified--you need to take into account changes in technology etc. If it was on the same plane, same configuration, same level of service...maybe you're right...but (and I'm only 21 so I don't know this for a fact either) I imagine that things have changed somewhat drastically since then!
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Old May 4, 2008 | 2:40 pm
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most of these flights were done with 747 or DC 8, as i recall. some 727's. i do not know the difference in efficiency in the original engines and the current ones, but i do not remember the seats being so very close together. i did weigh a lot less, so that may have been the major factor.
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Old May 4, 2008 | 4:17 pm
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Originally Posted by 3Cforme
The U.S. tax on aircraft fuel is zero - yes, zero. It is zero in (essentially) all countries by an old international treaty.
Oh really?

Senators Max Baucus, D-Mont., chairman of the Senate Finance Committee and Jay Rockefeller, D-W.Va., chairman of the Senate aviation subcommittee, late Friday came to an agreement not to impose aviation user fees to fund the Federal Aviation Administration. The deal made calls for general aviation turbine aircraft fuel taxes to increase to 36 cents per gallon from the current 21.8 cents per gallon.
Senate Leaders OK Private Turbine Aircraft Fuel Hike
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Old May 4, 2008 | 6:07 pm
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Originally Posted by Yaatri
whats general avation??????

is aa,dl,us,ua etc general avation??????????
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Old May 4, 2008 | 6:26 pm
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Originally Posted by slawecki
whats general avation??????

is aa,dl,us,ua etc general avation??????????

General aviation is all the flying that goes on that is non-commercial. AA/UA/US/DL etc are all considered commercial carriers, and as such are subject to different and typically more strenuous FAA regulations.
So anyone who owns a turbine engine aircraft that flies for recreation will be subject to the tax hike.
Not sure where charter companies fall under this--do they get the same tax exemption that commercial carriers do?
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