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Senate Passes On $1.2 Billion In Guaranteed Revenue

Kelly Phillips ErbAugust 3, 2011

Now that the debt ceiling fix is in place, you’d think that Congress would want to get to work on the rest of the budget. Um, not so much.

The Senate went on vacation for the summer without taking any action on the Federal Aviation Administration (FAA) budget. The previous budget ran out in July, along with the authority of the airlines to collect aviation taxes.

Initially, travelers kind of laughed it off as a crazy oversight. After all, Congress has been busy fighting amongst themselves mudslinging name-calling negotiating the debt ceiling.

But now, the laughing has petered off into an awkward silence.

Guaranteed federal tax dollars are literally disappearing.

Those aviation taxes might have been annoying but they were instrumental in funding FAA programs. The taxes guaranteed revenue to the tune of $200 million a week. That means that about $1.2 billion in taxes will go uncollected while Congress takes a break.

Generally, taxpayers not having to pay taxes is a good thing. But nearly every single airline is pocketing the difference between the fares with and without the taxes – which means that consumers aren’t getting a break and the government is digging itself a bigger hole.

The failure to pass a budget also means that nearly 4,000 FAA workers will remain without a job for the remainder of the summer. Those workers aren’t getting paid and planned airport projects sit idle while Congress takes a dip in the pool.

The House is quick to point out that they managed to push a version of the bill through but the Senate balked. The Senate never put the measure to a vote and instead, left town. Let’s just hope they aren’t planning on flying back…

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Kelly Phillips Erb
Kelly Phillips Erb is a tax attorney, tax writer, and podcaster.
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airline taxes, FAA budget, Federal Aviation Administration, Senate, Senate recess, tax, United States Congress

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