How things work
Jul. 29th, 2011 01:16 am![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
pecuniumLast week Congress (those guys fighting about how much gov't they are going to keep as they fight about whether or not to pay for the stuff they said they wanted in the last budget) let the Federal Aviation Administration go out of business.
Which is costing the gov't 25 million dollars a day in lost revenues, because without the authority to do business, the FAA has no right to collect taxes.
Yay, right, I mean that's money in your pocket, be those taxes were on airfares.
Right...
Not only did the the airlines not reduce fares by the amount of the taxes (about 45 bucks a ticket on average), they've been raising their fares.
Not only that, but they've already collected a lot of those taxes, which they don't owe anymore, Money which wasn't theirs to begin with. When someone orders a ticket, the taxes are included in the fare, but the airline doesn't have to pay it until you travel (which means they get some free money when a non-refundable ticket doesn't get used. No flight, no tax).
They make money on the float. But that money was charged as a tax, so they owe it back to you. They are, however, being a bit recalcitrant.
With 25 million dollars a day, times 2-3 weeks of lead time, lets call it 20 days... that's 20 x 25 x 1,000,00, or 500,000,000. Half a billion dollars.
I can see why they might want to be less than forthcoming with the money.
Here's what the IRS has to say about the changes in airline taxes
Here's what the airlines have to say about it, "But Jean Medina , a spokeswoman for the Air Transport Association , the airline industry trade group, said, “Basically, consumers are now paying the same as they did last week.”
Wanna bet that the prices will be treated as base when the taxes are re-instated?
Here's the NYT on the subject.
Which is costing the gov't 25 million dollars a day in lost revenues, because without the authority to do business, the FAA has no right to collect taxes.
Yay, right, I mean that's money in your pocket, be those taxes were on airfares.
Right...
Not only did the the airlines not reduce fares by the amount of the taxes (about 45 bucks a ticket on average), they've been raising their fares.
Not only that, but they've already collected a lot of those taxes, which they don't owe anymore, Money which wasn't theirs to begin with. When someone orders a ticket, the taxes are included in the fare, but the airline doesn't have to pay it until you travel (which means they get some free money when a non-refundable ticket doesn't get used. No flight, no tax).
They make money on the float. But that money was charged as a tax, so they owe it back to you. They are, however, being a bit recalcitrant.
With 25 million dollars a day, times 2-3 weeks of lead time, lets call it 20 days... that's 20 x 25 x 1,000,00, or 500,000,000. Half a billion dollars.
I can see why they might want to be less than forthcoming with the money.
Here's what the IRS has to say about the changes in airline taxes
Here's what the airlines have to say about it, "But Jean Medina , a spokeswoman for the Air Transport Association , the airline industry trade group, said, “Basically, consumers are now paying the same as they did last week.”
Wanna bet that the prices will be treated as base when the taxes are re-instated?
Here's the NYT on the subject.
