Delta and United rescinded their group discount offer for NRA members. United is based in Chicago and everyone expects gun violence there. Delta took a lot of heat for their position and tried to walk it back claiming they weren’t really taking a position on the issue.
The state legislature dropped an attempt to repeat the jet fuel tax that would have been a big subsidy for Delta. This was signaling to GOP primary voters.
Delta sets up discounts for meetings and events and for group travel in addition to offering corporations discounts in exchange for commitments of their travel and association discount deals. They just refused to do so any longer for the NRA, then claimed that was their not taking a position with the political climate in Georgia not wanting to remind anyone of this old button right now (because the event was held in Atlanta).
With the Republican primaries over and scrutiny passed, Delta gets the fuel tax dropped at least until the new legislative session convenes, and likely beyond. The outgoing Governor has suspended the tax administratively.
The 2019 General Assembly, which convenes in January, will decide whether to bless that decision or reinstate the tax. Deal cited the same code section to suspend the jet fuel tax that Gov. Sonny Perdue used to stop motor fuel taxes from rising at the start of the Great Recession.
The code section states, “The Governor may suspend the collection of taxes, or any part thereof, due the state until the meeting of the next General Assembly but no longer; but he shall not otherwise interfere with the collection of taxes.”
Delta’s CEO Ed Bastian says “allow us to invest additional flights into Georgia in the years to come.”
Oh the irony that Delta could use subsidised fuel to potentially open a flight to India, bypassing a Gulf hub, or resume Dubai service. https://t.co/o5ofs0I91r
— Will Horton (@winglets747) July 31, 2018
The only real surprise would be if Delta hadn’t managed to get it dropped. I don’t normally follow twitter, but that comment is spot on.
@M.O — While I have no position on the merits of Georgia suspending it’s fuel taxes, it’s important to understand that reduced taxes is NOT subsidization. It would be like arguing that Texas subsidizes its drivers by charging a lower gas tax than, say, New York. What goes on in the Middle East is, basically, the government handing their airlines cash — not taxing them less (there are no taxes).
Requiring Delta to pay the tax was a political stunt engineered by Lt Governor who was running for Governor & hoping to pander to the NRA voters of the state. Once he lost the GOP run-off, the tax no longer held any real importance especially considering Delta is one of the largest employers in the state..
Also unsaid is that suspending the fuel tax is hardly a sweetheart deal for DL. Most states have little or no fuel tax. Georgia’s was among the highest. Given the size of the ATL hub, this was obviously a significant tax burden on DL. Eliminating the tax is obviously good for DL, and will encourage further growth in service at ATL. DL went from being overtaxed to now having a pretty good (temporary) deal. I guess it’s less interesting to say that, especially for the crowd that wants another reason to dislike airlines.
Suspending the fuel tax is not a tax subsidy indeed, UNLESS the suspension applies only to Delta. Do other airlines operating at ATL receive the same treatment? No? Then it’s a subsidy.
@Tsvet,
Delta was not the only airline subject to the tax, although they are the largest purchaser of fuel in the state. Southwest also publicly thanked the Governor for suspending the tax
Requiring Delta to pay the tax was a political stunt engineered by the Lt Governor who was running for Governor & hoping to pander to the NRA voters of the state. Once he lost the GOP run-off, the tax no longer held any real importance especially considering Delta is one of the largest employers in the state.