15 Groups Protest Budget Proposal to Double Aviation Security Taxes

Fifteen leading airline, business and labor groups today urged Congress to reject a federal budget proposal that would double aviation security taxes

"Small communities will be particularly hard hit by tax and fee increases. Many cities have already seen a decrease in flights as airlines were forced to eliminate service because of higher security taxes and fees," said Deborah McElroy, president of the Regional Airline Association. "Regional airlines provide the only air service for 72 percent of U.S. cities. The proposed tax increases will make it even harder to continue to fly to many of these small- and medium-sized communities."

"Pilots have invested billions in concessions to help airlines restore a healthy bottom line and our efforts will fail under the weight of this exorbitant taxation," said Captain Duane E. Woerth, president of the Air Line Pilots Association. "Securing our air transportation system not only protects passengers, crew and cargo; it safeguards the U.S. economy and protects American jobs."

"The proposed fixed fee also hits low fare travelers hardest since it represents a higher percentage of lower fares," said David Stempler, president of the Air Travelers Association. "In that regard, it is a very regressive fee from an administration that prides itself on tax cuts and being very progressive on taxes. As passengers, we have been taxed, charged, and 'fee'd' to an excess. From the passenger ticket tax, to passenger facility charges, to flight segment fees, to airline security fees, international flight taxes, and immigration, customs, and agriculture fees, all of which can add up to more than 20 percent of a ticket and can rise to almost 50 percent of highly discounted fares. The administration's newly proposed security fee increase just adds insult to financial injury."

"A near doubling of the aviation security tax will only discourage travelers from flying for business and pleasure. This will also harm hotels, attractions, resorts, car rental firms and other travel industry companies and destinations that depend on these travelers for their economic livelihood," said Roger Dow, president and CEO of Travel Industry Association of America (TIA).

"We now know that travel security is national security, and it should be funded as a program that protects all Americans," said Bill Connors, executive director and COO, National Business Travel Association. "But travel is an essential gear in the American economic engine. It should not be discouraged by higher taxes. This proposed fee hike would cost businesses more than $400 million per year. Such an increase is likely to suppress demand among price- sensitive businesses travelers and create a negative impact on the nation's economy."

"Security is important, but will Americans be safer if Congress and the administration drive up the cost of air travel?" said Fred Smith, president of the Competitive Enterprise Institute. "Smacking an extra $1.5 billion tax on air travelers and sending it to a government agency isn't the most cost- effective way to improve airport security."

"We are stunned that the 'anti-tax' president wants to impose a whopping $1.5 billion tax hike on airlines, their workers and the flying public," said Edward Wytkind, president of the AFL-CIO's Transportation Trades department. "This will send an industry already in crisis into an even greater financial tailspin and leave airline workers wondering why they're being asked to pay for the protection and security of our air transportation system and infrastructure."

"It shouldn't be possible to make an intolerable tax burden even worse, but the Bush administration seems willing to try by proposing fee hikes on airlines and their customers," said John Berthoud, president of the National Taxpayers Union. "Many middle-class travelers pay a higher effective tax rate on an airline ticket than they do on their 1040 tax forms. Raising that rate further is fiscal and economic folly. Rather than reducing air carriers to a state of poverty and then providing handouts, the president should strip away the government-created impediments that prevent consumers and providers from developing a workable market for air travel. Spending more money without significant reform will only bring more turbulence for airlines in the future."