A potential new tax on air travel

Reading an airline ticket price these days is always an entertaining exercise.  There is the base fare which is generally pretty easy to understand.  And then there is a long series of letters and numbers representing various taxes and fees.  These extra costs can add up to be rather significant, even more than the actual base fare in some case for travel.  And now, if a group of developing countries have there way we will see another entry in that long line of taxes and fees – a tax to fund developing countries’ efforts to combat climate change.

The text of the tax was discussed at at a UN climate change conference in Bonn where it was proposed by the 50 least developed countries in the world.  The target is approximately $10Bn in revenue from the tax.  This is simply the latest effort from the developing nations to gain cash and support from developed countries to help fund their efforts in dealing with the effects of climate change.  Previously a few billion dollars have been pledged and a few hundred million even given to the countries, but nothing that they consider significant enough.

So now they are coming after the traveling public.  Folks who travel are an easy target for taxes.  They are often levied by local governments and affect folks who don’t vote locally so they are easy to pass without risking reelection for the politicians.  But the taxes also have a negative impact on the industry.  As the prices go up discretionary spending gets reduced.  In an industry that is predicted to lose $9Bn this year alone trying to extract another $10Bn seems about as foolish as actually expecting those numbers to hold.

Even worse is that the folks responsible for negotiating these taxes actually think they are a good idea:

“People are beginning to understand that innovative ideas could generate a lot of money. The Danish shipping industry, which is one of the world’s largest, has said a that truly global system would work well. Denmark would endorse it,” said [Connie] Hedegaard[, the Danish environment and energy minister.]

Working to address and solve the problems faced globally is a god idea.  Doing it on the back of an industry and economy that cannot support it is a horrible idea.  This falls into the latter category.

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Seth Miller

I'm Seth, also known as the Wandering Aramean. I was bit by the travel bug 30 years ago and there's no sign of a cure. I fly ~200,000 miles annually; these are my stories. You can connect with me on Twitter, Facebook, and LinkedIn.