Taxing Off A Runway

IBD Editorials ^ | September 9, 2009 | INVESTORS BUSINESS DAILY Staff

[Kaslin]

Taxes: Air travel is valuable but vulnerable, subject not only to mishaps but also to greedy tax bites that discourage consumers. Behold, then, two boneheaded schemes from both sides of the Atlantic.

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Hard to say which is worse. From the U.S., the Democrat-led Congress is mulling the misnamed "Travel Promotion Act" to hit travelers with a $10 tax for visiting the U.S. under the visa waiver program. High-spending Europeans will take the hit. The aim? To promote more tourism through a "nonprofit" company staffed by political cronies and set up to buy advertising.

From the U.K., a government advisory Committee on Climate Change is recommending a $10 tax of its own on every airline ticket sold. The purpose here is to compensate Third World countries for global warming, turning every business trip into a guilt trip. For anti-Western tinhorns already short of cash — like Zimbabwe's Robert Mugabe or Ecuador's Rafael Correa — the gravy train is rolling in.

Both the tax on tourists and the tax for dictators are likely to see retaliatory levies from the other side of the pond. For consumers, that means an extra $20 in fees for air travel just to start, which will pile high for families taking vacations or business travelers making multiple trips. Net result: less travel, a depressed airline industry that cannot grow and more job losses.

There's reason to think the tax sponsors on each side of the pond intend as much. Sponsors of both the House and Senate versions of the U.S. bill are among Congress' leading protectionists.

[Kaslin]