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High taxes, fees, discourage air travel, hurt service: study
By Glen
McGregor Excessive taxes and surcharges on Canadian airline tickets are discouraging passengers from flying and could soon force air carriers to reduce service to many communities, according to a study commissioned by the airline industry. Extra charges for security, airports, fuel and other fees range from seven per cent to 40 per cent of the final price of an airline ticket in Canada, according to the study. In the U.S., the extra charges account for only four per cent to seven per cent of the ticket price. The study says domestic airline traffic this year is down eight per cent compared to 2001, and the slowdown is markedly worse -- as high as 30 per cent -- in some regional markets, where extra fees account for a higher percentage of the ticket price. The slump in passenger demand, largely caused by the rising costs of tickets, has already forced airlines to eliminate service in some smaller communities and reduce the number of flights into even some larger centres such as Edmonton and Winnipeg, the study notes. That trend will continue unless the federal government eases the burden on consumers, said Cliff Mackay, president of the lobby group Air Transport Association of Canada (ATAC), which commissioned the study. "You will see more of what has already happened," Mr. Mackay said. "This will get worse." Although Mr. Mackay would not say which communities might lose service, cities in Atlantic Canada are believed to be at greatest risk. The airline group joined with representatives of the hotel and tourism industries yesterday to call on the government to reduce the extra costs. They want the $24 Air Travellers Security Charge scaled back to $7.65 -- the equivalent price in Canadian dollars that air travellers in the U.S. pay on round-trips. Despite the extra fees for security, a Canadian terrorism expert says our airports are some of the least secure around the world. Peter St. John, the author of books on terrorism and a security consultant to airlines and foreign governments, told Global News "we're at the bottom of the pile amongst western states I would say." On top of the base price for tickets, air passengers also pay fees for the air-traffic control agency, NavCanada, various airport improvement fees, GST (or HST) and excise charges on jet fuel. Transport Minister David Collenette said yesterday that while he is sympathetic to the airlines' complaints, the government believes that users of the airline industry should pay for added costs. "Everybody would like a free ride in life, but somebody has got to pay for the security." Mr. Collenette said the disproportionate
effect the flat-rate charge has on smaller communities is something that
Finance Minister John Manley will look at as he reviews the charge. |
