GAO report says airline fee systems too complicated
Posted on 18. Jul, 2010 by Kat Schneider Fotheringham in Blog, Business Travel, Uncategorized, corporate housing, executive accommodations, international business travel
According to a new report from the GAO, or Government Accountability Office of the United States, the complicated airline fee systems that continue to expand for U.S. air carriers are making it difficult for customers of all kinds, including corporate travel managers, to find the best deals, according to a new report.
While most fees are currently disclosed on airline websites, many flights (including those booked by corporate travel managers) aren’t purchased this way. The GAO reports contends that airlines should be required to disclose all fees to customers, no matter how the customer books a flight.
Both the Business Travel Coalition (BTC) and the National Business Travel Association (NBTA) support a change in the rules, further supporting testimony heard by a House of Representatives subcommittee last week. Why is the government getting involved? Follow the money, of course, is the answer. The government cares about this issue because airline fees aren’t taxed like airfares are.
Earning more money from fees can reduce airlines’ tax burdens, and that creates a massive incentive to charge more fees. As fees proliferate, the government is missing out on more and more tax revenue. So will there be airline fees in the near future? Sure. Will there be new fees. Probably.
But while the fees continue to grow, so will the government’s desire to tax them. The good news for travelers in all of this? The desire for the government to understand the airlines’ fee structure and how they are making their money (in order to tax it, of course), will potentially result in less fees being imposed by airlines, all in an effort to reduce the amount of government involvement and regulation the airlines already experience. In this case, less is definitely going to end up being more.
As corporate housing providers, it’s important for all of us to know what is potentially driving the market for our properties upward or downward. We’ll keep you posted on the latest developments on the government’s determination about how to handle the continuing battle over airlne fees.
