Base Fares Raised While Taxes Suspended. Passengers Told To Talk To The IRS

Some U.S. airlines are reportedly padding their bottom lines during the partial shutdown of the FAA by raising base fares to levels that would normally include FAA taxes and fees, while other carriers have kept base fares the same to reflect taxes that are not being collected.

In a story posted on the Huffington Post, the Associated Press reports that Delta, Jet Blue, United, Continental, and US Airways have raised base fares to a level that the customer would normally see when paying taxes and fees. But since they are not remitting those taxes to the government during the FAA slowdown, they are increasing their profit margins. Virgin America, Alaska Airlines, and Frontier Airlines are among the carriers which have kept base fares level, resulting in a lower overall fare.

JetBlue, United, and Continental have posted notices on their websites directing passengers to submit a claim for a refund to the IRS. The IRS says that, while submitting a claim to the tax agency is an option, it should be a last resort. They are saying that the passengers should seek a refund through the airlines before submitting the IRS claim.

Transportation secretary Ray LaHood says that the shutdown is costing the U.S. Treasury some $30 million a day in uncollected taxes.

FMI: www.irs.gov