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This legislation is necessary because two years ago, the U.S. Department of Transportation (DOT) enacted a regulation that requires airlines to include mandatory government taxes and fees in all advertised fares. As a result, when you see an advertised airfare — on aa.com or elsewhere — taxes and fees are included in the total price of the ticket. There is no breakdown of the base airfare versus the taxes and fees collected by the federal government.
The current law has allowed the government to increase taxes invisibly on airline passengers, causing fares to appear significantly higher than they really are. In fact, the base price of an airline ticket has actually decreased in recent years. Since 2000, the average base airfare has gone down 8 percent while government-imposed taxes and fees have increased 49 percent. Today, nearly one-fourth of the price of a round-trip domestic airline ticket goes to the federal government, but we are only allowed to tell you that in the fine print.
The DOT’s fare-advertising rule also makes the cost of your airline ticket appear to be priced less competitively than other forms of transportation such as buses, rail and rental cars, where no such rule exists. In fact, this approach differs from any other consumer product from food and clothing to entertainment and hotels.
The Transparent Airfares Act, which was recently introduced with strong bipartisan support in the U.S. House of Representatives, seeks to unbundle the advertised price of airfares and allow customers to better see what they’re paying and where their money is going. The Transparent Airfares Act would allow airlines to show base airfares in advertisements while clearly and separately disclosing government-imposed taxes and fees as well as the total cost of the ticket. I can assure you that at American Airlines, you will never be asked to finalize a purchase without knowing the full price of the ticket, including all federal taxes and fees. But with this legislation, you will be better informed to know exactly what you are paying for in advance. And by disclosing the taxes and fees, we hope to keep the increases in check.
Visit Airfaretransparency.com today to tell the administration, members of Congress and the DOT that you support a policy that does not require airlines to hide tax and fee increases from consumers.