Boston, MA 08/13/2014 (wallstreetpr) – The competition has increased significantly in last few months among Airlines, on top of that huge taxes are levied by the federal government. The airline companies are not enjoying this system. According to a recently published report, American Airlines Group Inc. (NASDAQ:AAL) has asked Federal authorities to fuel some sales tax relief.
Government’s Response:
According to a government official, the proposed hike in sales tax in Mecklenburg County may not put any impact on American Airlines Group Inc. (NASDAQ:AAL) sales tax cap is decided to be increased by state legislators. There are fair chances that airline is exempted completely from the taxes. Tracy Montross; director of American’s government affairs said, “The existing fuel cap that paid over $2.5 million to airlines fuel taxes, is going to expire on Jan. 1, 2016.”
She further added that most of the airlines that were serving in North Carolina area urged for tax exemption or extend the cap to keep the state in competition with Texas and South Carolina. The government in those two states has already given 100% exemption to airlines. In case the government decides to act passive, then North Carolina will soon become the fifth most expensive state in terms of money spent on fuel.
According to reports, the government is thinking over increasing taxes by quarter-cent. If it happens, then it will only add more pressure on airlines that may further result in increased ticket prices. Tracy said that airline industry was overtaxed and on average 21% of the ticket price was paid as taxes to the government. If government wants to develop North Carolina, then it will have to think once again about tax implications in the state.
When reporters asked American Airlines Group Inc. (NASDAQ:AAL) to comment on this issue, a spokesperson of the airline said, “We are not against the government’s decision of increasing taxes by quarter-cent for social well-fair, but we just want government to think sensitively about this issue.”
