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Wed, Feb 15, 2012

A4A: White House Budget Would Offset Deficit On Backs Of Airline Customers

Airline Association Says FY2013 Budget Proposal Seeks To Raise Billions Of Aviation Dollars, Will Cost Thousands Of Jobs, Impact Fares, Affect Service

Airlines for America (A4A) said Monday following the release of President Obama's budget that the White House budget proposal seeks to offset the deficit on the backs of airline customers by adding even more tax increases. The group says the budget as it is written would impact demand for air travel and ultimately cost jobs and service to communities. If the White House proposal is implemented, A4A said customers would be paying more in air taxes, meaning fewer will fly, which in turn will prompt airlines to reduce service, impacting hundreds of thousands of the 10 million good-paying jobs that commercial aviation creates.

The White House is proposing over the next five years to triple the aviation security tax to $7.50 for each one-way trip in 2018, resulting in an $18 billion government windfall to be used for deficit reduction – not on aviation security programs. In addition, the proposal also seeks to add a new $100 per flight tax with a portion of those proceeds also going toward deficit reduction.

"It makes absolutely no sense at a time when we should be encouraging economic and business development enabled by travel and tourism that we would discourage flying by trying to balance the budget on the backs of airline customers with yet another tax," said A4A President and CEO Nicholas E. Calio. "It is the wrong approach and counter to leveraging commercial aviation – a key enabler of job growth and U.S. economic activity. By holding the line on federal aviation taxes paid by airlines and their customers, the airlines can maintain jobs and provide much needed service to communities."

Airline customers today pay about $61 in taxes on a typical $300 ticket, rates higher than alcohol and tobacco, products that are taxed to discourage use.

FMI: www.airlines.org

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