LILLEY: Study shows how much more Canadians pay for flights due to tax

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Bothered by the price of the flight to see your sister in Kamloops, or your brother in Fredericton? Blame government taxes and fees for driving up the price of an airline ticket far higher than what our American counterparts pay.

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A new study from the Montreal Economic Institute titled “Wing Heavy: The fees that undermine the competitiveness of the airline sector” looks at the barrage of fees from airport rents to security fees, fuel surcharges and more.

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“Ottawa prefers to treat our airports as cash cows, rather than the essential transportation infrastructure that they are,” said Gabriel Giguère, public policy analyst and author of the study. “These taxes have a direct effect on the high cost of domestic travel in this country.”

The study points to the $419 million in rents the federal government collects from local airport authorities. That figure has increased from $284 million a decade ago, an increase of 42.5% in 10 years when the inflation rate at that time was 29%.

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The increases in rents took off after the 2015 election when the Trudeau government came to power with their free-spending ways.

Then there are the fees that the government imposes such as the air travellers security charge. This was brought in post-9/11 to pay for the increased screening at airports, it also appears to be a revenue tool for the government.

As the MEI report points out, the current fees range from $7.48 for a one-way domestic flight and $25.91 for an international flight but are set to increase by almost 33% to $9.94 for a one-way domestic flight and $34.42 for an international flight. There is no way that service levels for airport screening will increase by 33%, the people screening your bags won’t be one-third faster and they won’t be one-third nicer as they yell at you to put your laptops in a separate bin and to take your shoes off.

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The government will get a lot more money, though, an extra $1.2 billion in revenue over the following four years.

Now, let’s compare that to the United States where fees are significantly lower.

“The fee is currently $5.60 per one-way trip in air transportation that originates at an airport in the U.S., except that the fee imposed per round trip shall not exceed $11.20,” reads the Transportation Safety Administration’s website.

That works out to between $7.61 and $15.22 at current exchange rates. If you haven’t flown through the United States lately, with rare exceptions, the screening is smoother than most Canadian airports at a lower cost.

Finally, there are the various taxes on fuel from the excise tax to the carbon tax and GST applied on both of those previous taxes. The American excise tax on jet fuel is 1.55 cents per litre while the Canadian excise tax is 4 cents per litre or 158% higher than what the Americans pay.

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Is it any wonder that American airline tickets are that much cheaper than Canadian ones, even accounting for the exchange rate?

A return flight leaving Los Angeles for JFK next Sunday can be had on American Airlines for $913 Cdn. The lowest fare for a return flight booked for the same time from Toronto to Vancouver on Air Canada is $1,311.

That’s a $398 difference even though the Toronto-to-Vancouver route is 15% shorter in terms of distance.

“When you add up all of these fees charged by the federal government, you quickly realize that a substantial portion of the price of a plane ticket is taxes,” Giguère said. “Whether a ticket is bought for a vacation or to reach our remote regions, these taxes have a negative effect on families’ budgets.”

Translation, it stops us from flying, from travelling, from seeing loved ones. You know who hasn’t changed their flying habits? Justin Trudeau, because you and I pay for his tickets.

It’s time for the Trudeau government to give airports, airlines and travellers a break and stop using this industry as a cash cow.

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