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Consumer groups call airfare act a mistake

– Airlines have found new allies in their fight against a requirement that they include U.S. taxes and fees in their advertised fares: every member of a congressional panel overseeing the agency that created the rule.

Without hearings or debate, the House Transportation and Infrastructure Committee unanimously approved a bill April 9 that would let carriers resume their former practice of most prominently featuring base fares, rather than the total price. Taxes, baggage fees and other costs that can make up a substantial portion of what consumers pay can be displayed through links or pop-ups.

Consumer groups say the “Transparent Airfares Act” would accomplish the opposite, enabling bait-and-switch advertising and making comparison shopping on websites almost impossible. To the groups’ surprise, Democrats on the House panel who usually support legislation they favor voted for the measure.

“Right now prices are more transparent than they’ve ever been,” said Charlie Leocha, director of the consumer group Travelers United. “The price you see in an ad is the price you’re going to pay for a ticket. The airlines have managed to push this thing through. They’ve got a lot of clout, especially with Congress.”

Airlines for America, a Washington trade group, is leading a lobbying effort for the legislation after several carriers unsuccessfully fought the rule through its drafting by the Transportation Department, a White House review and a lawsuit that ended at the U.S. Supreme Court. Most of the largest U.S. airlines and unions representing their workers filed letters supporting the bill.

“On its face, full-fare advertising sounds as though it is protecting the consumer, when in reality it is protecting the government, enabling spikes in taxes to be hidden and buried within the price of a ticket,” said Vaughn Jennings, a spokesman for the trade group, which includes American Airlines and Southwest.

The airlines gained momentum with Democratic lawmakers to undo the rule after a congressional budget agreement reached in December included a $12.6 billion boost over 10 years in the aviation-security fees paid by passengers as part of the ticket price. Airlines in that same deal won a repeal of $380 million a year in their own security fees.

In letters supporting the legislation, airlines including Spirit Airlines and Dallas-based Southwest said the fee increases would lead to total-price increases that consumers would blame on them, resulting in lost sales.

“I’m just tired of people tossing stuff onto airline passengers,” Rep. Peter DeFazio, D-Ore., a co-sponsor of the bill, said in an interview. “I think if the amount of federal tax that people are paying becomes known and the structure of the taxes becomes known, it will be a lot harder in the future for my colleagues to say we need another $1 billion so let’s bump this up or that up.”

In its arguments in the court challenge, filed by Miramar, Fla.-based Spirit and Southwest, the Transportation Department pointed to hundreds of complaints received during a comment period before issuing its final rule in 2012. Some consumers said they sometimes didn’t know what they’d paid until after the transaction was completed, the department said.

“Against the weight of all this consumer response and common sense, the airlines marshal no evidence of their own to support the counterintuitive proposition that consumers are somehow better informed when advertisements quote a price that is substantially lower than the amount the consumer will need to pay for air travel,” the government argued.

The Transportation Department, while declining to comment on the legislation, still defends its rule.

“Consumers have consistently confirmed that advertising of prices below the total cost of travel causes confusion,” Meghan Keck, a department spokeswoman, said in an email.

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