FAA Loses $30 Million a Day as Tax-Collecting Powers Lapse

July 26, 2011 at 12:58 pm | Posted in Aviation Law Current Event | Leave a comment

by Sara M. Langston with the blog faculty

Source: Bloomberg

The Federal Aviation Administration said it’s losing $30 million a day in taxes because Congress let the agency’s revenue-raising authority expire.

Airlines can’t collect excise taxes on tickets, fuel and cargo until Congress passes legislation to extend the FAA’s authority, Randy Babbitt, the agency’s administrator, said today on a conference call from Washington. The FAA operated through July 22 under a series of 20 short-term extensions, after its multiyear funding legislation expired in 2007.

Most major airlines have raised base ticket prices by at least 7.5 percent to capture the forgone federal revenue, Rick Seaney, chief executive officer of FareCompare.com, a website that tracks ticket prices, said in an e-mailed report. [Full story]

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