Taxing the Airlines

http://www.futureofcapitalism.com/2011/10/taxing-the-airlines

The Wall Street Journal has details of how President Obama's "jobs" bill would affect airlines and passengers:

The proposal includes a doubling of the federal security surcharge of $2.50 per one-way trip to $5. Annual increases would triple the fee to $7.50 by 2017....Gary Kelly, CEO of Southwest Airlines, estimates the proposed [$100 per] departure tax alone would cost his company $140 million a year. ...US Airways Group Inc. estimates the departure tax could cost it $110 million a year. AMR Corp.'s American Airlines pegs its expense at $124 million.

The Journal doesn't mention this, but it's interesting to consider the administration's assault on airlines in the context of its support for high-speed rail. Here's a network of private companies that are already doing the job of getting passengers between cities. The government is already forcing the air passengers through either naked body-scan machines or physical pat-downs. Now it wants to raise taxes on the airlines and their passengers by billions of dollars, while at the same time spending billions to subsidize inter-city "high-speed rail" that would compete with airlines for customers. It looks like more of a job-destruction strategy than a job-creation strategy.

by Editor  |  Oct 5, 2011 at 6:07 am Related Topics:  President Obama, Taxes receive the latest by email: subscribe to the free futureofcapitalism.com mailing list