Taxes and Fees on Flights: What You Need to Know

Whenever I make flight bookings, I always look at a breakdown of the taxes and fees to see what I’m actually paying for. Since it’s not possible to avoid paying them, I thought it might be interesting to dig a bit deeper into finding out what we’re actually paying for whenever we book air travel with points or cash.

The taxes and fees that you pay when booking a flight vary wildly, and are dependent on the airline you fly with, the class of service you’re in, and the airport, province, territory, or country you depart from. In some situations, it amounts to next to nothing, while in others, it adds a significant cost.

Here is an overview of the most common taxes, fees, and surcharges found on air travel bookings.

Government-Imposed Charges

Many of the extra fees on airline tickets are imposed by governments around the world.

Taxes

From a Canadian perspective, the most obvious culprits are the Goods and Services Tax (GST) and Harmonized Sales Tax (HST). While this doesn’t have much of an impact on award bookings, depending on the cost of the base fare of a paid ticket, it could become sizeable.

The GST or HST rate is determined by the city of origin on your booking. For example, a booking from Vancouver to Toronto will incur a 5% GST cost, while a booking from Toronto to Vancouver will incur a 13% HST cost. 

For round-trip bookings, the tax amount is based on the city of origin for the entire booking. So, if you were to book from a city in a province with a lower tax burden, such as Calgary, you’d wind up paying less than from a city in a province with a higher tax burden, such as Toronto.

Suppose flights between Calgary and Toronto have a total cost, inclusive of the base fare and fees, of $100 per direction. For the purposes of this example, we’ll ignore the fact that you get charged HST on the Airport Improvement Fee in Toronto and GST on the Airport Improvement Fee in Calgary.

Booking two one-way flights between Toronto and Calgary would incur a total of $18 paid in taxes (5% GST for the Calgary–Toronto flight and 13% HST for the Toronto–Calgary flight), whereas booking the same flights round-trip out of Toronto would incur a total of $26 (13% HST for both legs).

While this particular example was done with a low fare, as the cost of the ticket increases, so would the amount of taxes…