ARTA alerts travel agents refunds may be due for US ticket taxes

SCOTTSDALE, Arizon – The Association of Retail Travel Agents (ARTA) alerted members that certain US ticket taxes would not apply for tickets issued on or after July 23, 2011 or for tickets issued prior to that date, but for travel on or after July 23, 2011.

Due to the lack of agreement to extend the FAA authorization before Congress adjourned this weekend, the inaction causes, among other things, various transportation taxes to expire, most notably:

• The 7.5% tax generally applicable to domestic transportation (Tax Code: US)

• The US$3.70 domestic segment tax (Tax Code: ZP)

• The US$16.30 international arrival/departure tax each way for flights to Canada, Mexico, or other foreign destinations (Tax Code: US)

• The US$8.20 departure tax for flights between Alaska/Hawaii and the mainland US (Tax Code: US)

Other US taxes and/or fees still apply.

Therefore, for tickets issued on or after July 23, 2011, for applicable travel anytime, the above taxes will not apply.

For tickets issued on or before July 22, 2011, for applicable travel on or after July 23, 2011, a refund for overpayment may be due. ARTA has been in touch with various stakeholders responsible for disseminating the rules regarding refunds. It is unclear at this point whether refunds should be requested from the ticketing carrier or directly from the IRS.

At this time, ARTA would recommend holding off on any refunds until the refund process is made clear.

It should be pointed out that if Congress subsequently agrees to extend the FAA Reauthorization, the taxes above would be reinstated and further refunds may not apply.