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The argument is that the way airlines are taxed actually encourages them to charge fees because no tax is imposed on fees collected for "non-essential" services. So the tax treatment incentivises airlines to keep fares low because they are taxed and to make up the difference with various fees because they are not taxed. So by making the charge for carry-ons taxable, they argue, will reduce the incentive to charge for them.
I don't know if the tactic will work or not but I welcome the fact that the Senators are, at least, looking at this issue. This is all the more necessary because, in true cartel style, if one charges they all charge (Southwest excepted). So we need some regulation.
There is no incentive to stop. If the airlines are planning on charging $45 and the feds decide to tax it the airlines will simply charge $55 instead. We pay the tax for them.
I would rather they just issue an outright BAN on such non sense. You should have a right to carry a bag on board- and even a right to check one bag for free.
I would rather they just issue an outright BAN on such non sense. You should have a right to carry a bag on board- and even a right to check one bag for free.
You TELL 'EM KEVK! WE AREN'T TAKING IT ANYMORE!!! We've put up with your CRAP long enough!!! BAN THE NON-SENSE!!!
(I need a bigger soapbox, does anybody have one I can borrow so I will be heard at the back of the room?)
I would rather they just issue an outright BAN on such non sense. You should have a right to carry a bag on board- and even a right to check one bag for free.
I would prefer the government quit trying to regulate businesses that htey know nothing about. Now, if they think there is some cartel-like price fixing then that can be investigated but airlines should be allowed to charge fees if the flying public lets them get away with it by continuing to fly on those airlines (which we seem to be doing).
What I would really like to see is government stop using tax policy to reward or punish consumer behavior. That's why the tax code is 20,000 pages long now. The carrot and stick of the tax code is one of government's most powerful weapons against the electorate. We should not encourage them to expand it.
I would prefer the government quit trying to regulate businesses that htey know nothing about. Now, if they think there is some cartel-like price fixing then that can be investigated but airlines should be allowed to charge fees if the flying public lets them get away with it by continuing to fly on those airlines (which we seem to be doing).
What I would really like to see is government stop using tax policy to reward or punish consumer behavior. That's why the tax code is 20,000 pages long now. The carrot and stick of the tax code is one of government's most powerful weapons against the electorate. We should not encourage them to expand it.
But there is cartel-like price fixing. One does it and they all do it. Southwest is the exception but all the others are the rule.
If there is cartel like price fixing why don't they ever make any money?
Because they price it like Amtrak or Greyhound. They don't price it like a premium service. But then they would need to give premium service and we all know most airlines in the US lack basic customer service (except JetBlue). Its sort of amazing that most American based airlines give really bad service in the states, but yet the same American based airlines give nearly excellent service outside of the states. I flew with Delta and Continental within the past 30 days and both of them followed this issue to the letter.
Last edited by Pruzhany; 04-24-2010 at 08:52 PM..
Reason: Update
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