Transparent Airfares Act of 2014

Background

Since 2012, federal regulations have required airlines to prominently display the full cost of an airline ticket in their advertisements. The United States Department of Transportation calls this "full-fare" advertising.

Provisions of the bill

This summary is based largely on the summary provided by the Congressional Research Service, a public domain source.

The Transparent Airfares Act of 2014 would declare that it shall not be an unfair or deceptive practice for an air carrier or other covered entity to state the base airfare in an advertisement or solicitation for passenger air transportation if it clearly and separately discloses: (1) the government-imposed taxes and fees for the air transportation, and (2) its total cost.

The bill would define "base airfare" to mean the cost of passenger air transportation, excluding government-imposed taxes and fees.

The bill would define "covered entity" as an air carrier, including an indirect air carrier, foreign carrier, ticket agent, or other person offering to sell tickets for passenger air transportation or a tour or tour component that must be purchased with air transportation.

Congressional Budget Office report

This summary is based largely on the summary provided by the Congressional Budget Office, as ordered reported by the House Committee on Transportation and Infrastructure on April 9, 2014. This is a public domain source.

H.R. 4156 would require the United States Department of Transportation (DOT) to promulgate a rule related to how prices for certain types of air transportation are advertised. Under current policies, DOT requires that advertised prices for air travel reflect the total price per passenger to be paid by customers, including government-imposed taxes and fees. Under H.R. 4156, sellers of air transportation could instead advertise base airfares, provided that advertisements also disclose the amount of additional government-imposed taxes and fees that customers would pay.

The Congressional Budget Office (CBO) estimates that enacting H.R. 4156 would have no significant effect on the federal budget. Based on information from DOT we estimate that any costs incurred to complete the proposed rulemaking, which would be subject to the availability of appropriated funds, would be insignificant. H.R. 4156 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply.

H.R. 4156 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would impose no costs on state, local, or tribal governments.

Procedural history

The Transparent Airfares Act of 2014 was introduced into the United States House of Representatives on March 6, 2014 by Rep. Bill Shuster (R, PA-9). The bill was referred to the United States House Committee on Transportation and Infrastructure and the United States House Transportation Subcommittee on Aviation. On July 24, 2014, it was ordered reported alongside House Report 113-554. On July 28, 2014, the House voted to pass the bill in a voice vote.

Debate and discussion

Passage of the bill was seen as a "victory for airlines and their workers' unions." The airlines argue that being forced to include government taxes and fees in their advertised ticket price hides from the public the amount of their ticket that is government mandated forced costs and hurts the airlines' business.

Jean Medina of the organization Airlines for America (A4A) argues that the federal government is "burying tax hikes in the advertised cost of a ticket, hiding these considerable charges from consumers who pay them." Nicholas Calio of A4A said, "It's a misnomer to characterize the current law as a consumer protection rule when it really protects the government, not airline passengers, and it's disingenuous for Washington to hide the ball and not be held responsible for the taxes they impose on air travel." A4A said that as of 2014, $61 of a $300 domestic airfare is taxes.

Rep. Bill Shuster, who introduced the bill, said that "this bill will allow airlines and travel agents to display the actual costs in a transparent way, in order to allow customers to see the base airfare and government taxes and fees." Shuster thought that "it is only fair that consumers know what they are paying for."

Opponents of the bill argued that the result would be much more confusing ticket information where it would be difficult to find the full price. The U.S. Travel Association argued against the bill, with President Roger Dow saying that "by no means should we undo the existing rule that enables consumers to see the full bottom-line price when they're ticket shopping."