Taxes on Flights Home for the Holidays

As anyone who’s ever bought an airplane ticket home for the holidays knows, taxes and fees on air travel can be a significant part of your travel budget. We’ve written before at the Tax Foundation on how much gas taxes and tolls can cost for holiday travel by roads, but taking to the skies is often  little better.

Being an economically-minded person, I looked into the details of my own travel home for Christmas. According to my bill, I paid $48.44 in taxes on a $229.76 ticket: that’s a 21 percent tax rate. But, according to Airlines for America, an airline industry group, federal airline taxes for a ticket totaling $300 average $61.49. That’s 20 percent of the ticket price, or the equivalent of a 26 percent sales tax.

Airline Taxes, Example Round Trip Ticket from DC to Kentucky




Base Ticket Price






Passenger Ticket Tax


7.5% of base fare

Domestic Flight Segment Tax


$3.90 per flight segment

September 11th Security Fee


$2.50 per plane

Passenger Facility Charges


Varies by airport; up to $4.50




Total Taxes and Fees



*$3 for Charlotte airport, $4.50 paid twice for DCA arriving and departing

There are, in fact, at least 17 different taxes and fees on air travel in the United States. Some of these taxes and fees, like the Passenger Facility Charges (PFCs) that airports levy, can be seen as “user fees,” wherein airports bill passengers for the cost of expanding airport facilities and services. On my flight, I paid PFCs in Charlotte, and both going and coming at DCA in Virginia.

The passenger ticket tax, which works like a 7.5 percent sales tax on tickets, and the domestic flight segment tax, which is a $3.90 fee on each flight leg of a journey, both finance the Airport and Airway Trust Fund, which pays for the Federal Aviation Administration (FAA). With a little bit of imagination, these two taxes can also be seen as “user fees.”

The FAA oversees air traffic control, which is essential for air travel, and provides many grants to airports for improvements. However, the FAA is also a major regulator of the airline industry, which contributes to higher costs: so these aren’t “pure” user fees, any more than taxes that pay for a traffic cop’s salary is a “user fee” for highways.

The September 11th Security Fee (9/11 Fee) I paid, which will double to $5 per enplanement in 2014 as part of the recent budget deal, is also only dubiously-defined as a user fee. Revenues raised from the 9/11 Fee fund Transportation Security Administration operations, especially security checkpoints at airports. While it may be true that passengers “use” these security services, probably very few of us wake up in the morning hoping we get to pay $2.50 (let alone $5) to walk through a full-body scanner and then get frisked.

There are still more taxes on international flights per arrival and departure, and numerous taxes applied to airline fuel which are baked into the price of the ticket. These taxes can be hard to measure, as they vary by route, airline, airplane, and even the weather, all of which affect fuel consumption.

Even more taxes are applied to pay for homeland security, border control, and agricultural inspections, such that taxes and fees on international flights can be in the hundreds of dollars. With so many airline taxes so high and set to go higher, taxes and fees can represent a major share of air travel costs. Policymakers would do well to look into the “services” being provided, and decide if they are worth the cost, before they raise airline taxes and fees further.

Lyman Stone