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
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
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
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
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.
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
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.
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
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
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)
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
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?
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
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
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
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
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.