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This tax loophole is so egregious even millionaires like me want to close it

Private jet owners — who have lined the pockets of politicians for years through generous donations — pay pennies compared to what commercial passengers are charged in federal taxes. For example, according to a report from the progressive think tank Institute for Policy Studies, commercial fliers pay a number of taxes and fees on their tickets, ranging from the 7.5% federal ticket tax to the $4.50 Passenger Facility Charge. Meanwhile, private and corporate jet owners only pay a $0.218 per gallon tax for jet fuel or a $0.193 per gallon tax on gasoline.

Despite our shared reliance on critical resources like the Air Traffic Control (ATC) system, commercial airlines pay 95% of all taxes to the Federal Aviation Administration’s trust fund, totaling $14.85 billion of the $15 billion collected last year. Meanwhile, private and corporate jets use 15.6% of ATC resources but pay only 1.55% of all taxes into the trust fund. In effect, regular commercial fliers are subsidizing private jets to the tune of more than $1 billion a year.

Consider the costs of a flight from New York to Los Angeles. A CEO in a private jet will pay a paltry $525 in fuel taxes, according to a review by Bloomberg, while commercial passengers traveling the same route would be on the hook for $3,900. That’s because the private jet is only charged the fuel tax, while the commercial flier has to pay the fuel tax, passenger fee, excise tax, and other taxes and fees. By the time both land, the private jet owner will owe 87% less in taxes for the same cross-country flight.

This tax loophole is so egregious even millionaires like me want to close it
This tax loophole is so egregious even millionaires like me want to close it

The upshot: Private jets pay a tenth of airline taxes despite flying the same routes.

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