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Press Release
FOR IMMEDIATE RELEASE: April 26, 2010
SCHUMER ANNOUNCES NEW CAMPAIGN TO SECURE "NO CARRY-ON BAGGAGE FEE" PLEDGE FROM REMAINING 21 MAJOR DOMESTIC AIRLINES
Airline's Recent Decision to Charge Passengers A Whopping $45 for Carry-on Baggage Exploits Unintended Tax Loophole; Will Likely Encourage Other Airlines to Follow
Schumer has Secured Commitments from 5 Major Airlines to Keep Carry-On Bags Free; Will Pressure Other 21 Domestic Carriers to Make Same Pledge
Schumer Legislation Will Close Tax Loophole Encouraging Practice
Today, U.S. Senator Charles E. Schumer announced that he is working to fix a loophole in current regulations that have airlines charging customers for bringing aboard even one piece of carry-on luggage. Recently, Schumer secured a commitment from five major airlines to keep carry-on baggage free and announced on Monday his new campaign to step up public pressure to get the 21 uncommitted domestic airline carriers to commit as well. During an appearance at Syracuse Hancock Airport, Schumer also urged Secretary Geithner to issue a new administrative rule that would define carry-on baggage for air travelers as a “reasonable necessity” in order to help keep carry-on baggage free for fliers and keep other airlines at bay from passing similarly outrageous fees for carry-on luggage that we saw this past week. Recently, a prominent airline broke long-standing airline practices by announcing it would begin charging customers a whopping $45 for carry-on luggage. The decision by this company could spur other airlines to impose a similar fee.
“Our recent progress has provided tremendous momentum to ensure that carry-on baggage is always free,” Schumer said. “But the campaign to keep carry-on bags free from gimmick charges won’t end until every domestic airline commits to a ‘no carry-on fee pledge, or my legislation is enacted into law.”
Today, Schumer announced his plan to contact the remaining 21 uncommitted domestic carriers urging them to make similar commitments. Just last week, Schumer met with Spirit Airlines CEO Ben Baldanza and personally urged him to drop the airline’s outrageous $45 fee on carry-on baggage. And just a short time ago, Schumer, along with several of his Senate colleagues announced new legislation to confront airlines that would sock travelers with new fees for carry-on luggage. The Block Airlines' Gratuitous (BAG) Fees Act, or the BAG Fees Act, is designed to nip this new in practice at its inception and restore basic fairness to air travelers.
Schumer said action is needed now to ensure that this fee does not spread to other airlines. Several years ago Spirit instituted the industry first fee for checking the 1st bag, and that fee then spread to other airlines. Schumer said that action is needed now to prevent that process from replaying itself.
Schumer’s legislation would confront the carry-on baggage fee by designating carry-on baggage as a necessity for air travelers. Airlines currently pay a 7.5-cent tax to the federal government for every dollar they collect in fares, but no tax is imposed on fees collected for non-essential services. Last January, the Treasury Department issued a ruling that deemed carry-on bags as non-essential for air travel. As a result, airlines can impose fees on these bags without paying any tax to the federal government on the revenues they collect. This creates a tax incentive for airlines to try to bilk consumers in the form of fees rather than fares. The senators said Wednesday that if this tax loophole regarding carry-on bags did not exist, the airlines would likely not seek to charge travelers for this baggage. Schumer’s legislation and his campaign to secure a ‘no carry-on fee’ pledge from the 21uncommitted domestic airlines has been endorsed by Consumers Union.
In the past few years, some airlines have added fees for checked baggage, extra legroom, seat assignments, peanuts, and one airline is considering charging for trips to the bathroom. For the most part, passengers have begrudgingly accepted these new fees. These latest fees have brought passengers to the tipping point.
Since the inception of commercial air travel, customers have always been given the opportunity to bring one carry-on bag with them to store in the overhead compartment without fear of being slapped with an additional fee. Carry-on luggage is particularly essential for weekend travelers, day-trippers, and overnighters. The new fee will greatly add to the cost of travel for both business and leisure travelers. Families with children will also be hurt, as parents almost always need a carry-on item in order to store vital items like medicine, baby formula, or diapers. The timing of the fee will also likely impact those trying to take their family on a summer vacation.
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