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Article Excerpt
Ask airline executives how much taxes and fees eat into the price of a domestic roundtrip and they likely will tell you that they hover around 26 percent per ticket. It's no surprise, then, that taxes often follow fuel as the biggest gripe expressed by domestic carriers.
However, new data show taxes and fees are about 10 percentage points lower than many in the industry purport. In fact, on tickets typically favored by corporate travelers--those for higher-yielding, higher-bucket nonstop flights--government-levied fees fall below the 16 percent average tax rate.
The percentage of an airline ticket comprising taxes hinges on such factors as the cost of the base fare, the number of connections and through which airports passengers pass. Airline taxes as they relate to tickets follow a few rules of thumb: the higher the airfare, the lower the percentage of taxes and the more connections, the higher the percentage of taxes.
Though taxes on domestic flights certainly can fall in the 26 percent-plus range, professors at MIT and Daniel Webster College, who have studied how taxes and fees are applied to airfares, place the average figure in the 15 percent to 16 percent range, according to yet-to-be-published data collected for two years through the last quarter of 2005.
While the professors' research first debunked the 26...
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