The Secret Benefit to Airlines From Checked Baggage Fees

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About Gary Leff

Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel - a topic he has covered since 2002. Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »

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Comments

  1. That’s not how any of this works. Airlines don’t “eat” the 7.5% excise tax on airline tickets out of their bottom line…passengers pay the 7.5% tax on air transportation when they buy a ticket and the airline *passes that tax on to the government*. If the excise tax were also applicable to checked bag fees, the passenger would also pay the 7.5% tax and the airline would *pass the collected tax on to the government*. Hence, there is no savings to the airline as it is merely a pass-through to the government.

    The checked bag income of course contributes to their total revenue for corporate income tax purposes.

  2. I frequent the Centurion lounges and the exception for layovers was made clear months ago when the policy was first implemented. You and Lucky (OMAAT) seem to think this is new and newsworthy. Anyone with an Amex Platinum or Centurion card should have known this so I guess it is a slow news day and you guys are just looking for something to fill space

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