Taxes, fees increase air travel costs

Think you know what your airline ticket costs? Not so fast.

Taxes and fees on airline tickets can add a bundle to that advertised price. For overseas travel, add-ons can nearly double the cost of a ticket.

One $324 round-trip fare from New York to London costs $657 once all the taxes and fees are included.

The price on one nonstop round-trip ticket from Atlanta to San Francisco goes from $350 to $377 with taxes and fees. A different offer, a one-stop fare to the same destination, looks like the better deal at $331. But once taxes and fees are calculated, it's actually $2 more -- with an almost four-hour layover.

Bottom line: Look at the total price of a ticket, not merely the fare. And pay attention to those itinerary details.

"The most dreaded symbol in airline ads is the asterisk," says Peter Greenberg, author of "The Travel Detective: How to Get the Best Service and the Best Deals from Airlines, Hotels, Cruise Ships and Car Rental Agencies." "Because you know it's not going to be beneficial to you."

These days, many airlines and online ticket sellers include both the fares and the total ticket price (with taxes and fees) well in advance of that "buy" button. Likewise, reservations clerks with airlines and ticket sellers often will advise you of the complete total before you give your credit card number.

In many cases, the airlines don't set the fees and don't make a dime from them. Often the levies are excise taxes that cover the cost of running the air transit system, including maintaining air traffic control, operating airports and inspecting planes.

Other taxes pay for airport security, customs and immigration services. One fee, set by the airports, helps pay for airport upkeep and expansion.

Some airlines impose fees for certain services, such as requesting a paper ticket or booking by phone instead of online. Some carriers also will add fuel surcharge fees on certain flights.

Including that fuel fee with federally and locally mandated taxes, instead of folding it into the ticket price, galls some consumer advocates.

"It allows them to advertise cheap fares that don't exist," says Clark Howard, nationally syndicated radio host and co-author of "Get Clark Smart: The Ultimate Guide to Getting Rich from America's Money-Saving Expert."

One industry insider says the surcharge is a smart marketing strategy that also gives consumers more information.

From a passenger point of view, a fuel surcharge is "just a fare increase," says John Heimlich, vice president and chief economist for the Air Transport Association, an airline industry trade group.

Breaking it out separately and pointing out that the expense is incurred because of rising fuel costs is a way to "try to get more customer empathy for the cost pressures" airlines are facing, he says.

"With a price-sensitive good, like air travel, you have to go the extra mile to connect with the customer," Heimlich says.

In addition, those surcharges "cover a fraction of the extra fuel costs," he says, noting that passenger airlines spent $11 billion on fuel in 2002 and $38.6 billion in 2006.

Here are some air travel fees and taxes you'll likely encounter while paying for your next flight:
Domestic passenger ticket tax. A 7.5 percent tax on the price of airfare. (This goes into the Airport and Airway Trust Fund to maintain the air transit system.)
Segment tax. A $3.40 fee for each takeoff and landing. Change planes and you'll pay twice. (This goes into the trust fund.)
Rural airport tax. A 7.5 percent tax on the price of the ticket if you fly into or from a regional airport. You'll pay either this or the domestic passenger ticket tax, depending on whether you're flying through a major or rural airport. (This goes into the trust fund.)
Passenger facility charge. Up to $4.50 (varies by airport) each time you use a different airport. Can be charged up to twice one way. (This goes to the airports to offset maintenance and expansion.)
Flights to and from Alaska or Hawaii. $15 for a round-trip flight between the United States or Canada and either Alaska or Hawaii. (This goes into the trust fund.)
International departure tax: $15.10 to leave the United States for a foreign destination, but only if you're not paying the domestic passenger ticket tax. (This goes into the trust fund.)
International arrival tax, $15.10 to arrive in the United States from a foreign destination, but only if you're not paying the domestic passenger ticket tax. (This goes into the trust fund.)
Customs user fee (if arriving from outside the United States). $5.50. (This is set by the Department of Homeland Security.)
Immigration user fee (if arriving from outside the United States). $7. (This is set by the Department of Homeland Security.)
Security fee. $2.50, up to $5 one-way. (This is set by the Department of Homeland Security.)
APHIS (Animal and Plant Health Inspection Service) passenger fee (if arriving from outside the United States). $5. (This is set by the Department of Homeland Security.)
Fuel surcharges. At the airline's discretion, to offset fuel costs.
Paper ticket charge. Some airlines may charge up to $50 to provide a paper copy of your ticket, rather than an e-copy. Some online vendors will also add a similar fee, in addition to what the airlines charge.
Phone reservation charge. Some airlines and online sellers will charge extra if you book by phone instead of online.
Change fee. Need to change your itinerary after you've bought the ticket? The airline or the online seller may charge you.

The best deal
So why separate the airfare from the taxes and fees in the first place? Why not simply have one all-inclusive price for the ticket?

"Airlines do want you to know what we're charging, and we want you to know that the total ticket price is not all us," says Heimlich.

Listing the airline fares separately from taxes and fees is the only way consumers know where the money goes when they buy those tickets, he says.

Fortunately, with an abundance of online sites for airlines, discounters and consolidators, consumers have more options than ever for comparison shopping.

hat shopping around can save you money because some airlines will charge more in fees than others, says Howard.

In addition, some routes will cost more because more taxes or fees are incurred.

That's especially true with international flights where you're subject to other countries' fees and taxes, says Howard. So pay careful attention to the price difference in those one-stop and nonstop flights on other continents, where stopping over in a third country can add a whole new set of fees.

To get a feel for the ways the cost of your trip can go up or down with certain routes or choices, put several versions of your trip itinerary into an airline's online site and see how ticket prices may change. Try the same approach with a site like Orbitz.com or Travelocity.com that allow you to peruse prices from multiple airlines.

How do you evaluate those rock-bottom travel deals you see advertised without taxes and fees? Use your calculator.

"The rule of thumb, from my own personal experience, is for a domestic ticket, multiply the price by 1.25," says Greenberg. "And for an international ticket, multiply it by 1.75."