New US law to ensure taxes and fees get included in every advertised airfare

Jan 3, 2012

The U.S. Department of Transportation (DOT) is in news for a consumer rule that enhances protections for air travellers, and requires carriers, among other things, to include all government taxes and fees in every advertised fare beginning January 24, 2012.

 

The Department believes that consumers need to be able to see the entire price they need to pay to get to their destination the first time the airfare is presented to them. 
 
In a related development, it has emerged that Southwest Airlines, Allegiant Air and Spirit Airlines have filed legal appeals to have the rule overturned in the U.S. Court of Appeals in the D.C. circuit. According to a report filed by cnn.com, Southwest’s spokesperson mentioned that there is “no justification for treating air travel differently” from just about everything else that consumers purchase, i.e. they pay for the price of goods and services and then pay tax. And that’s how everything is advertised, as the price of the item separately from the tax on that price.
 
The Department has been fining airlines and travel companies for violating price advertising rules. 
 
In November last year, it fined Spirit Airlines $50,000 for violating federal aviation laws and the Department’s rules prohibiting deceptive price advertising in air travel. 
 
Explaining the case, the Department mentioned that for a period of time in June 2011, Spirit used billboards and hand-held posters to advertise new service from Los Angeles that contained an asterisk next to the advertised fare.  On the billboards, the asterisk led to small print which stated that additional taxes, fees and conditions would apply, but did not disclose the amount of those taxes and fees.  The posters did not include any information about the taxes and fees or their amounts. In addition, Spirit sent Twitter feeds announcing $9 each-way fares.  A consumer who clicked on the link that was provided was taken to a page on Spirit’s website where the carrier disclosed for the first time that these fares did not include all taxes and fees, and that they were subject to a roundtrip purchase requirement.  Only after clicking on a second link, which took readers to the bottom of the page, was the amount of additional taxes and fees disclosed.