NCPA - National Center for Policy Analysis

Hiking The Airport Tax Versus Privatization

March 7, 2000

An aviation bill nearing completion in Congress would increase the passenger airport tax from $3 to $4.50 per person. That means that a passenger making a round trip with a connecting flight would be charged an extra $18 for his ticket.

The Airport Trust Fund already gets roughly $10 billion a year in airport user fees.

Free-market advocates suggest that, rather than imposing a higher tax, airports should be privatized. London's airports at Heathrow and Gatwick have been privatized and should serve as a model for the U.S. Moreover, the trend is spreading worldwide.

Heritage Foundation analyst Ronald Utt has taken a look at what privatization would mean for Atlanta's Hartsfield International Airport.

  • The airport may be worth as much as $5.5 billion
  • Selling it would net each Atlanta resident as much as $13,5000 in tax relief -- not to mention the taxes a private airport would pay.
  • Or funds realized through the sale could be applied to education -- $90,000 more for each student.

Under today's setup, new airlines often can't find gates at government-run airports because the authorities tend to sign long-term leases with big airlines in order to ensure a long-term revenue stream.

But for-profit airport management could allocate gates on an hourly basis. Then gates which otherwise go idle when a carrier has no flights scheduled could be utilized by competitors.

Source: Editorial, "Dunning Through Airports," Investor's Business Daily, March 7, 2000.


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