ATA: security tax proposal would widen U.S. airlines losses

ATA: security tax proposal would widen U.S. airlines losses    The Air Transport Association along with other business and labor groups believe that the new federal budget security tax proposal will see U.S. airlines’ losses for 2005 increase by $1.5 billion to a predicted $6.5 billion deficit.
   “We believe this $1.5 billion tax proposal will put another 19,000 airline jobs at risk and jeopardize up to 115,000 flights to small- and medium-size communities,” said James C. May, president and chief executive officer of the ATA.
   “U.S. airlines face unprecedented stress, with five now in bankruptcy and all but two operating at a loss last year, said Patrick V. Murphy, Jr., partner in Gerchick-Murphy Associates and former DOT assistant secretary of transportation for aviation and international affairs. “At this juncture, adding new costs to this fragile sector could speed the demise of weakened carriers, and so undermine the competitive benefits of the aviation system for passengers and consumers, and industry workers,” he added.
   “U.S. airlines and travelers already will contribute $15.8 billion through 14 different federal taxes and user fees in 2005. The total tax burden represents 26 percent of a typical $200 roundtrip ticket, up from 7 percent 20 years ago,” the groups said in a joint statement.
   Groups opposing the new security tax include the Air Line Pilots Association, Air Transport Association, Air Travelers Association, Americans for Tax Reform, Cargo Airline Association, Competitive Enterprise Institute, Gerchick-Murphy Associates, Interactive Travel Services Association, J. Dunham and Associates, National Business Travel Association, National Taxpayers Union, Regional Airline Association, Travel Business Roundtable, and Travel Industry Association of America.