Are Flights Taxed? A Breakdown of Government Fees

Yes, airline flights are taxed. A considerable portion of the final price for an airline ticket consists of government-imposed taxes and fees. These charges are not airline revenue; they are collected by carriers and passed on to government entities. The funds generated from these taxes primarily finance the nation’s aviation infrastructure, including airport development and security. The exact amount fluctuates based on the specifics of an itinerary, such as whether it is a domestic or international flight and the number of connections.

Federal Taxes on Domestic Flights

When purchasing a ticket for air travel within the United States, passengers pay federal taxes that support the national aviation system. The primary tax is the U.S. Federal Excise Tax, calculated as 7.5% of the ticket’s base fare. These funds are deposited into the Airport and Airway Trust Fund, administered by the Federal Aviation Administration (FAA) to finance airport improvement projects and air traffic control services.

In addition to the excise tax, a Federal Segment Tax is applied to each leg of a domestic journey. A “segment” is defined as a single takeoff and landing. For 2025, this tax is set at $5.20 per segment, so a flight with a connection has two segments and double the tax of a nonstop flight.

To illustrate, consider a round-trip domestic flight with a $300 base fare and one connection each way, resulting in four total segments. The Federal Excise Tax would be $22.50 (7.5% of $300), and the Federal Segment Tax would be $20.80 ($5.20 x 4). The combination of these two federal taxes adds $43.30 to the ticket price.

Federal Taxes on International Flights

Travel that includes a departure from or arrival in the United States is subject to a different set of federal taxes. Instead of a percentage-based tax, international flights incur a flat-rate U.S. International Transportation Tax. For 2025, this tax is $22.90 per passenger for both departures and arrivals.

The application of this tax can change for travel to certain nearby destinations. For flights between the U.S. mainland and destinations in a “buffer zone,” including most of Canada and Mexico within 225 miles of the U.S. border, domestic tax rules often apply. This means passengers on these routes would pay the 7.5% excise tax and the segment fee rather than the flat international tax.

A different rate also applies to travel between the U.S. mainland and Alaska or Hawaii. On these routes, the international tax is a lower charge of $11.40 for 2025. This special consideration accounts for the portion of the flight that occurs over international waters or foreign airspace.

Government-Imposed Fees

Beyond federal taxes, passengers pay government-imposed fees to cover security and airport infrastructure costs. These are mandatory charges, not classified as taxes. The September 11th Security Fee directly funds the Transportation Security Administration (TSA). This fee is $5.60 per one-way trip and is capped at $11.20 for a round-trip itinerary, regardless of the number of connections.

Another charge is the Passenger Facility Charge (PFC). PFCs are collected by airlines on behalf of airports to fund local improvement projects like runway enhancements or terminal expansions. The fee amount is set by the departing airport and can be up to $4.50 per segment, with federal regulations capping the total PFCs on an itinerary at $18.00.

Application to Award Travel Tickets

Passengers using frequent flyer miles to book award tickets often find they are not entirely free. While the loyalty program covers the base fare, the passenger is responsible for paying the applicable government-imposed taxes and fees in cash. The 7.5% Federal Excise Tax, which is based on the ticket’s fare, is not charged on an award ticket.

However, all other flat-rate federal taxes and government fees are still due. This includes the Federal Segment Tax for each flight segment, the September 11th Security Fee, and any applicable Passenger Facility Charges. For international award travel, the U.S. International Transportation Tax would also be charged.

The total cash co-pay for an award ticket can vary significantly. A simple domestic round-trip award might only cost $11.20 in security fees plus segment taxes and PFCs, while an international award could have a much higher cash component due to international taxes and fees imposed by the destination country.

Identifying Taxes on Your Itinerary

Airlines are required to provide a detailed breakdown of the charges that constitute the total ticket price. This information is found on the e-ticket receipt or booking confirmation email. The itemization allows passengers to see exactly how much they paid for the base fare versus the various taxes and fees.

When reviewing a ticket receipt, look for a section labeled “Taxes, Fees and Charges” or a similar title. Under this heading, you will see an itemized list with specific codes and amounts. Common charges you may see listed include:

• U.S. Transportation Tax (the 7.5% excise tax)
• U.S. Flight Segment Tax
• U.S. September 11th Security Fee
• Passenger Facility Charge (PFC)