Author Topic: Taxes & Fees on Award Tickets  (Read 2295 times)

Offline chff

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Taxes & Fees on Award Tickets
« on: June 16, 2019, 03:17:25 PM »
A while back I had in mind to show a comparison of how backwards Elal does their award tickets, resulting in overpaying in taxes, but was busy with some other stuff so I had to put it aside. Recently I saw that the DOT has fined Lufthansa for overcharging tax on awards, so I looked into the matter again but found Qantas to be a bigger culprit. Still tried to get clear and detailed info from the DOT / IRS / IATA / GDS if this info is correct, but no one can answer me straight.

Let’s start with a sample revenue fare NYC>TLV>NYC

Code: [Select]

 1   EWR UA  084 L 01JAN  420P OK LLA96NCS        01JAN01JAN 1PC               
 2 O TLV UA  085 L 20JAN 1135A OK LLA96NCS        20JAN20JAN 1PC               
     EWR                                                                       
FARE  F USD     240.00                                                         
TX001 X USD   598.00-YQAD TX002 X USD     3.96-XACO TX003 X USD     7.00-XYCR   
TX004 X USD     5.77-YCAE TX005 X USD    18.60-USAP TX006 X USD    18.60-USAS   
TX007 X USD     5.60-AYSE TX008 X USD    26.81-ILEB TX009 X USD     4.50-XF     
TOTAL   USD     928.84                                                         
GRAND TOTAL USD     928.84                                                     
EWR UA TLV120.00LLA96NCS UA EWR120.00LLA96NCS NUC240.00END                     
 ROE1.000000 XF EWR4.5                                                         

Code: [Select]

 1   JFK LY  002 U 01JAN  450P OK ULAPSNY         01JAN01JAN 1PC               
 2 O TLV LY  025 U 20JAN 1205A OK ULAPSNY         20JAN20JAN 1PC               
     EWR                                                                       
FARE  F USD     830.00                                                         
TX001 X USD     3.96-XACO TX002 X USD     7.00-XYCR TX003 X USD     5.77-YCAE   
TX004 X USD    18.60-USAP TX005 X USD    18.60-USAS TX006 X USD     5.60-AYSE   
TX007 X USD    26.81-ILEB TX008 X USD     8.00-APSE TX009 X USD     4.50-XF     
TOTAL   USD     928.84                                                         
GRAND TOTAL USD     928.84                                                     
NYC LY TLV Q295.00 120.00ULAPSNY LY NYC Q295.00 120.00ULAPSNY NUC830.00END       
 ROE1.000000 XF JFK4.5                                             

A few details you can see above. The airlines compete dollar to dollar on the end total price. And now lets break it down (all tax code is a 2 alphanumeric code, the 3rd& 4th  alphanumeric part is an “internal” sub-code)

Fare - is the base fare - UA 240 & LY 830. UA has “YQ” which is 598, vs LY has in the fare breakdown 2 “Qs” for 295 per direction. UA is following most airlines and doing a “Fuel Surcharge” vs Elal is doing a “fare surcharge” which gets bundled in the fare itself, this part ועוד חזון למועד.

Now for the tax itself (other than the YQ) you will see Elal has a tax of $8.00 named “AP(SE)” - this is an Israeli tax charged $4 per flight on every Israeli carrier. This is way UA will be $4 cheaper per way then QF/LY. Regarding the awards I will just breakdown the American Taxes

Code: [Select]

TX001 X USD     3.96-XACO - United States APHIS Passenger “Fee”
TX002 X USD     7.00-XYCR - United States Immigration User “Fee”
TX003 X USD     5.77-YCAE - United States Customs User “Fee” 
TX004 X USD    18.60-USAP - US International Departure “Tax”
TX005 X USD    18.60-USAS - US International Arrivals “Tax”
TX006 X USD     5.60-AYSE -  US September 11th Security “Fee” 
TX009 X USD     4.50-XF   - US Passenger Facility “Charge” 

So first you can see that the US does not have the cheapest Taxes & Fees on airfare, plus it’s the most complicated in the world, 8 taxes/fees compared to 2-3 for other countries, plus XF has to be coded per airport. US domestic airfare is even more complicated. You can also see 4 are called “fees”, 2 “taxes” and 1 a “charge”. - Also note that the US tax is not depend on the class, premium classes don’t pay more tax/fees.

(Side interesting fact - the XF tax is “supposed” to go to the airport for upkeep & improvement, but when the “Twin Towers” < yes the one in the 1970s, the Port Authority got a waiver from the FAA to divert the XF funds to build the Twin Towers, and kept the money going to the PANYNJ general fund ever since & not to the airport directly. No wonder why the NYC airports look a dump.)

AFAIK (if I got this correctly - again I didn’t get clear info from the DOT/IRS/GDS/IATA) that award tickets that are “free” - ie other the mileage no carrier surcharges are added, then the ticket is exempt from “Tax” - meaning the $18.60 per direction on International flights.

Another important DOT law for airfare in general, that the end “TOTAL” price has to be shown, like $928.84 and not “$240.00 plus fuel surcharges & taxes and fees”. (plus they have to disclose baggage fees may apply - but the ticket price itself has to be shown in full).

2 weeks ago Wandering Aramean blogged about Lufthansa being fined $200,000 by the DOT for illegal award ticket taxation - I didn’t understand correctly (and so was the Attorney I spoke with at DOT this week) if it was for displaying one price and charging more, or the general thing that they charged US tax while not required. Now based on the info that US is exempt on completely free award tickets, the only tickets where LH overcharged is on UA, as on all others they charge YQ/YR and therefor you must pay the US tax.

Now let’s see some award tickets

United Round Trip EWR>TLV - no US tax or the XF charge - done correctly
Code: [Select]

Base $0.00
- September 11th Security Fee $5.60
- U.S. Immigration User Fee $7.00
- Israel Departure Tax $26.81
- U.S. Customs User Fee $5.77
- U.S. APHIS User Fee $3.96

LOT/Lufthansa one-way JFK>BUD - YQ is charged & so is the US tax. XF is not charged.
Code: [Select]

1   JFK LO  034 J 24XXX  550P OK JXX037V
     BUD                                                                       
FARE  R USD       0.00                                                         
MILES            37000                                                         
TX001 X EUR    53.19-YQAC TX002 X EUR    16.49-USAP TX003 X EUR     4.97-AYSE   
TOTAL   EUR      74.65    BSR 0.886483                                         
GRAND TOTAL EUR      74.65                                                     
NYC LO BUD0.00NUC0.00END ROE1.000000                                           
MILEAGE NYC BUD37000TOTAL37000                                                 

Singapore award on UA - no YQ & therefor no US tax
Code: [Select]

FARE  F USD       0.00                                                         
EQUIV   SGD       0.00                                                         
MILES            27500                                                         
TX001 X SGD     7.70-AYSE                                                       
TOTAL   SGD       7.70    BSR 1.366XXX                                         
GRAND TOTAL SGD       7.70                                                     
XXX UA X/NYC UA EUR0.00NUC0.00END ROE1.000000                         
MILEAGE XXX XXX27500TOTAL27500                                                 

Singapore award on LX - YQ is charged & so is the US tax.
Code: [Select]

1   TLV LX  257 I XXMON  520A OK IBP00STR                   2PC               
 2 X ZRH LX  016 I XXMON  950A OK IBP00STR                   2PC               
     JFK                                                                       
FARE  F USD       0.00                                                         
EQUIV   SGD       0.00                                                         
MILES            69000                                                         
TX001 X SGD     5.40-XA   TX002 X SGD    24.20-US   TX003 X SGD    21.80-CH     
TX004 X SGD    36.10-IL   TX005 X SGD     9.40-XY   TX006 X SGD     7.40-YC     
TX007 X SGD   264.80-YQ                                                         
TOTAL   SGD     369.10                                                         
GRAND TOTAL SGD     369.10                                                     
TLV LX X/ZRH LX NYC0.00NUC0.00END ROE1.000000                                   

Singapore award on SQ & OS - is charged & so is the US tax. - This is open for discussion as the YQ is only on the intra-Europe segment as SQ no longer charges YQ
Code: [Select]

 1   JFK SQ  025 I XXMON  855P OK IBP00STR
 2 X FRA OS  ZZZ X XXMON 1250P OK IBP00STR
     EUR                                                                       
FARE  F USD       0.00                                                         
EQUIV   SGD       0.00                                                         
MILES            72000                                                         
TX001 X SGD    61.50-YQAD TX002 X SGD    25.50-USAP TX003 X SGD     7.70-AYSE   
TX004 X SGD    14.70-DESE TX005 X SGD    33.00-RAEB                             
TOTAL   SGD     142.40    BSR 1.366245                                         
GRAND TOTAL SGD     142.40                                                     
NYC SQ X/FRA OS ZZZ0.00NUC0.00END ROE1.000000                                   
MILEAGE NYC ZZZ72000TOTAL72000                                                 

Aeroplan award on UA - no YQ & therefor no US tax
Code: [Select]
XXMONXXEWR UA TLV R0.00CAD0.00 END ROE1.00 XT7.50AY
XXMONXXTLV UA EWR R0.00CAD0.00 END ROE1.00 XT36.40IL5.40XA 7.80YC9.50XY

Aeroplan award on AC - YQ is charged & so is the US tax (and seems like XF tax as well)
Code: [Select]
XXMONXXCHI AC YMQ R0.00CAD0.00 END ROE1.00 XT 27.00YQ 7.50YR 24.20US 7.40AY XF6.00 ORD4.50


And now let’s move on to Qantas

One-way economy NYC>TLV - $5.60 AY tax & no US tax - done correctly
Code: [Select]

 1   EWR LY  026 E 16AUG 1135P OK EBP
     TLV                                                                       
FARE  F USD       0.00                                                         
TX001 X USD     5.60-AYSE TX002 X USD     4.00-APSE                             
TOTAL   USD       9.60                                                         
GRAND TOTAL USD       9.60                                                     
NYC LY TLV0.00NUC0.00END ROE1.000000                                           

But why on premium & business do they charge the US tax?
Code: [Select]
1   JFK LY  004 P 01XXX  100P OK PBP
 2 O TLV LY  011 P 20XXX  435P OK PBP
     JFK                                                                       
FARE  F USD       0.00                                                         
TX001 X USD     3.96-XACO TX002 X USD     7.00-XYCR TX003 X USD     5.77-YCAE   
TX004 X USD    18.60-USAP TX005 X USD    18.60-USAS TX006 X USD     5.60-AYSE   
TX007 X USD    26.81-ILEB TX008 X USD     8.00-APSE                             
TOTAL   USD      94.34                                                         
GRAND TOTAL USD      94.34                                                     
NYC LY TLV0.00LY NYC0.00NUC0.00END ROE1.000000                                 

Code: [Select]

1   JFK LY  008 X 01XXX 1145P OK XBP
     TLV                                                                       
FARE  F USD       0.00                                                         
TX001 X USD    18.60-USAP TX002 X USD     5.60-AYSE TX003 X USD     4.00-APSE   
TOTAL   USD      28.20                                                         
GRAND TOTAL USD      28.20                                                     
NYC LY TLV0.00NUC0.00END ROE1.000000                                           

ETA > A DDF member just shared with me his booking confirming this discrepancy. He was booked round trip in economy & then changed to premium, and was then charged the $18.60 US tax

Old Ticket
Code: [Select]
1   EWR LY  026 E 01MON  950P OK EBP
 2 O TLV LY  025 E 10MON 1205A OK EBP
     EWR                                                                       
FARE  F USD       0.00                                                         
TX001 X USD     3.96-XACO TX002 X USD     7.00-XYCR TX003 X USD     5.77-YCAE   
TX004 X USD     5.60-AYSE TX005 X USD    26.81-ILEB TX006 X USD     8.00-APSE
TOTAL   USD      57.14                                                         
GRAND TOTAL USD      57.14                                                     

New ticket - the taxes that have an "X" before are the new ones paid at ticket exchange
Code: [Select]

 1   EWR LY  026 P 01MON  950P OK PBP
 2 O TLV LY  025 E 10MON 1205A OK EBP
     EWR                                                                       
FARE  R USD       0.00                                                         
TX001 X USD    18.60-US   TX002 O USD     3.96-XA   TX003 O USD     7.00-XY     
TX004 O USD     5.77-YC   TX005 O USD     5.60-AY   TX006 O USD    26.81-IL     
TX007 O USD     8.00-AP                                                         
TOTAL   USD      18.60                                                         
GRAND TOTAL USD      18.60                                                     

And Elal does awards the most backwards way
Code: [Select]

FXP/RFFY,U*BONUS/A-PBPB1100                                                     
   1.LAST/FIRST                                                         
 1   EWR LY  028 P 01XXX  115P OK PBPB1100
 2 O TLV LY  007 P 01XXX  930A OK PBPB1100
     JFK                                                                       
FARE  F USD     250.00                                                         
TX001 X USD     5.65-YCAE TX002 X USD    18.30-USAP TX003 X USD    18.30-USAS   
TX004 X USD     3.96-XACO TX005 X USD     7.00-XYCR TX006 X USD     5.60-AYSE   
TX007 X USD    26.81-ILEB TX008 X USD     8.00-APSE TX009 X USD     4.50-XF     
TOTAL   USD     348.12                                                         
GRAND TOTAL USD     348.12                                                     
NYC LY TLV Q125.00 0.00LY NYC Q125.00 0.00NUC250.00END ROE1.000000 XF EWR4.5   

So instead of doing a “Surcharge” as a fee, Elal does it as the base fare, so simply put this is a regular paid ticket at a discount and pays for every single tax & fee. Yes I know it’s only $4.50 that they are definitely overpaying, but still… and plus it’s so not a “Yiddish Kup” to do that.


Offline israshot

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Re: Taxes & Fees on Award Tickets
« Reply #1 on: June 26, 2019, 07:45:44 AM »
So I complained to Qantas (by SMS), few days later got the refund.
2 × Business with infant.


As you can see they modified the taxes to $9.60.
Google is my friend

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Re: Taxes & Fees on Award Tickets
« Reply #2 on: June 26, 2019, 09:45:40 AM »
So I complained to Qantas (by SMS), few days later got the refund.
2 × Business with infant.


As you can see they modified the taxes to $9.60.
Nice, anyone else?
Save your time, I don't answer PM. Post it in the forum and a dedicated DDF'er will get back to you as soon as possible.

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Re: Taxes & Fees on Award Tickets
« Reply #3 on: June 26, 2019, 09:59:25 AM »
Nice, anyone else?
In the process, will report back.

Always praying for delayed baggage.

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Re: Taxes & Fees on Award Tickets
« Reply #4 on: June 26, 2019, 12:07:20 PM »
In the process, will report back.
No luck, tried via text multiple times with clear explanation. They denied and claim they charge all tax.

Not worth my time .
Always praying for delayed baggage.

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Re: Taxes & Fees on Award Tickets
« Reply #5 on: June 26, 2019, 12:13:14 PM »
No luck, tried via text multiple times with clear explanation. They denied and claim they charge all tax.

Not worth my time .
Told them to look at the tax charge for a new res?
Save your time, I don't answer PM. Post it in the forum and a dedicated DDF'er will get back to you as soon as possible.

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Re: Taxes & Fees on Award Tickets
« Reply #6 on: June 26, 2019, 01:21:02 PM »
So I complained to Qantas (by SMS), few days later got the refund.
2 × Business with infant.


As you can see they modified the taxes to $9.60.
I just got a phone call from Qantas, they wanted to make sure that I'm aware about the refund they are processing.
He apologized for the wrong taxes charged and said that "it has been raised with the internal team and pricing team to have this investigated and see what is going on there".
Google is my friend

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Re: Taxes & Fees on Award Tickets
« Reply #7 on: June 26, 2019, 01:25:41 PM »
Anyone else try?
Save your time, I don't answer PM. Post it in the forum and a dedicated DDF'er will get back to you as soon as possible.

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Re: Taxes & Fees on Award Tickets
« Reply #8 on: June 26, 2019, 01:36:39 PM »
Told them to look at the tax charge for a new res?

Yes
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Offline israshot

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Offline Jkhein

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Re: Taxes & Fees on Award Tickets
« Reply #10 on: June 26, 2019, 02:25:10 PM »
Nice, anyone else?
I just did it, took three texts and got a response:
Hi, Jkhein. I have successfully refunded an amount of AUD37.20 per person for booking reference XXXXXX.

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Re: Taxes & Fees on Award Tickets
« Reply #11 on: June 26, 2019, 05:24:31 PM »
Worked for me via SMS.

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Re: Taxes & Fees on Award Tickets
« Reply #12 on: June 26, 2019, 11:56:03 PM »
am I eligible for refund for reservations prior to the program changes? or the tax thing changed after the change?
TIA

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Re: Taxes & Fees on Award Tickets
« Reply #13 on: June 27, 2019, 01:00:54 PM »
so, how much should the total tax be for 2 pax in biz from jfk to tlv?

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Re: Taxes & Fees on Award Tickets
« Reply #14 on: June 27, 2019, 01:01:59 PM »
so, how much should the total tax be for 2 pax in biz from jfk to tlv?
$19.20.
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