By JACK NICAS CONNECT
Dec. 9, 2013 7:34 p.m. ET
Congressional leaders seeking a budget deal look likely to include a measure doubling a tax on U.S. airline passengers, drawing protests from the industry and consumer groups.
Commercial fliers in the U.S. typically pay $2.50 a flight for a "September 11th security fee," instituted about a decade ago to help fund the then-newly formed Transportation Security Administration. Any budget deal will almost certainly increase that fee, according to officials close to congressional negotiations.
Both House Republicans and the Obama administration have suggested charging fliers $5 per one-way trip, whether it is nonstop or requires a connection. Today fliers pay $2.50 on nonstop trips and $5 on trips that require a connection, as each leg of the journey carries a $2.50 fee.
The Obama administration has also proposed gradually increasing the one-way fee to $7.50 by 2019. Its proposal would raise an additional estimated $25.9 billion over 10 years. About $8 billion of that revenue would offset aviation-security costs while the remaining $18 billion would reduce the national debt, according to the proposal.
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The budget deal is still in flux, so the fee increase and how much money it would raise aren't yet clear. The offices of the congressional budget leaders, Republican Rep. Paul Ryan of Wisconsin and Democratic Sen. Patty Murray of Washington, declined to comment on any specifics of the negotiations.
The aviation fee is one of several ideas that lawmakers are considering to increase revenue or savings without raising objections from Republicans, who generally oppose higher taxes. Those ideas include overhauling federal employee pension programs, as well as selling more spectrum.
The pension changes likely would raise annual contributions paid by most civilian federal workers, from about 0.8% of salary now. An Obama administration budget proposal would increase that contribution level to 2% of salary over a few years, generating budget savings of $20 billion. A House Republican plan would go further, raising contribution levels and also making broader structural changes, at a savings of $132 billion.
The administration and lawmakers also have been looking for spectrum that can be repurposed and auctioned off. The Obama administration has proposed a spectrum license user fee on wireless, satellite and some broadcasting outlets, but it has been bottled up in Congress.
Meanwhile, a vocal conservative political group Monday stepped out in opposition to an emerging House-Senate budget agreement even before the deal has been inked and announced.
Heritage Action, a conservative group that often weighs in on legislation and political campaigns to push the GOP further to the right, put out a statement expressing opposition to a plan that is expected to replace near-term spending cuts with long-term deficit reductions. The group called it a "gimmicky, spend-now-cut-later deal."
On the aviation fee, the airline industry estimates that increasing it to $5 each way would cost fliers an additional $732 million annually, on top of the nearly $2 billion they already pay to the TSA each year. Airlines and fliers covered 30% of the $7.5 billion the TSA spent on aviation security last year, according to the agency's website.
The TSA declined to comment.
Nick Calio, president of Airlines for America, the industry's largest trade group, said the fee increase allows lawmakers "to make it look like the airlines are raising ticket prices when, in fact, [lawmakers are] taking something they call a fee and are using it for more federal spending."
Douglas Kidd, head of the National Association of Airline Passengers, said the flier-advocacy group is already skeptical of the value of the air-security fee, questioning the efficacy of the TSA in securing air travel. "We don't like the tax as it is, so we certainly don't want to see it increased," he said.
Mr. Calio's group said airlines and their customers are among the most heavily taxed groups in the U.S., paying nearly $19 billion through 17 different federal taxes and fees last year. The Federal Aviation Administration received most of that revenue, the group said.
Speaking from a vacation in Japan, the passenger-advocate Mr. Kidd agreed. For instance, he said, he used airline miles to pay for the almost $1,900 airfare from Washington, D.C., to Tokyo, but he still had to pay more than $600 in taxes to the U.S. government for the flight.
—Janet Hook and John D. McKinnon contributed to this article.
