Who's taxing who?

It's long been argued that airlines and airports in Canada (especially ones near the U.S. border) are often competitively disadvantaged when compared to their U.S. counterparts, because of the higher taxes and fees charged to air travellers in Canada. 

On a recent visit to the Bellingham Airport, I couldn't help but notice that the majority of vehicles in the parking lot were from British Columbia--Canadians crossing the border for a good deal. In fact, according to the airport, 60% of the passengers flying out of Bellingham are Canadian.

There are a few reasons for this, not withstanding that Bellingham Airport, or BLI as it is known by its three letter code, is just 32 km (20 miles) from the Canada/U.S. border. First, BLI is served by low-cost carrier Allegiant, which operates to seven leisure destinations from that airport, and often offers exceptional fares. 

The second point is that the taxes and fees charged on a ticket from Bellingham are much lower than on similar flights from Vancouver International. This got me curious as to the difference in these taxes and fees, and who collects what? 

Respective governments in Canada often take the brunt of criticism from passengers, and those in the industry, who have long complained about high taxes and fees on airline tickets. But after comparing fares from both Bellingham and Vancouver, I was somewhat surprised to learn that Uncle Sam has his hands in your pockets, more than most people are probably aware. 

  

So, here's what I did. I chose Honolulu as a destination, because, well...who wouldn't want to go to Hawaii? And also because Alaska Airlines will begin daily service from Bellingham in January. 

Honolulu's famed Waikiki Beach, with Diamond Head bottom right

Sames dates were chosen for each example. For this example I chose the same dates in April.  

Scenario 1 - Bellingham - Honolulu

Alaska Airlines

$426.20 - fare

$21.40 - taxes/fees

$447.60 - total

Alaska Airlines does not break the various taxes down when making a booking, but at $21.40 it's a modest amount. 

Scenario 2 - Vancouver to Honolulu

WestJet (Air Canada's fare was $15 more)

$497 - fare 

$110.25 - taxes/fees

$607.25 - total

Here is a breakdown of the $110.25 in taxes and fees charged on a ticket departing Vancouver. 

$15 - NAV Canada surcharge (funds air navigation system)

$15 - Vancouver airport improvement fee

$25.91 - Canadian Air Travellers Security Fee 

$1.80 - Canadian Sales Tax

$4.62 - U.S. Passenger Facility Charge

$33.04 - U.S. Transport Tax

$5.13 - U.S. Agriculture Fee

$2.57 - September 11 Security Fee

$7.18 - U.S. Immigration Fee

$110.25 - Total

The light blue represents the Canadian taxes/fees and the dark blue are those collected by U.S agencies. Surprising to many, perhaps, but you'll notice that almost half--$52.54--are U.S. taxes and fees. 

So, what does it tell us? Well, it shows that the United States isn't as tax friendly as they are made out to be, and a family of four flying to HNL would save more than $600 by flying out of Bellingham. Explains why there are so many cars from Canada parked at BLI.