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Aviation History
1961
1961 - 1805.PDF
FLIGHT, 14 December 1961 917 actual expenses (cost, less income from transit aircraft) of TaipeiAeronautical Communications Station and Shuneshan Weather Station on an average basis if they make revenue stops at TaipeiThe remaining 80 per cent is paid by the airlines in proportion to the number of nights and mileage between Taipei and other air-ports during the month. Non-scheduled flights are each charged at £3 11s for communications and £1 15s 6d for meteorology.YUGOSLAVIA. Charges are made for navigation facilities according to the route flown. Figures vary from £6 16s to £13 18s. Britain Too? IT is common gossip that the Ministry of Aviation, with Treasuryprodding, has for a long time been considering the imposition of some such charge. Airlines are busy speculating on just howmuch it will be and how it will be assessed. To be a workable proposition any levy of this kind must fulfil several conditions.The main considerations can be summarized as follows: (a) the charge should be proportional to the benefits received; (/>) it shouldbe free from unnecessary complications; (c) the administrative processes involved should not require a large number of extra staffor elaborate book-keeping or billing; (d) costs of collection should be a negligible percentage of the receipts. Since at least two, or even three, of these considerations arealien to conventional bureaucratic procedures it remains to be seen just which particular method the UK will adopt. It may be astraight copy or an adaptation of one of the methods quoted for other countries; or, if the system used for landing fees is anyindication, it might be something new. Whichever scheme is adopted one can be sure of one thing: the airlines will scream longand loud. One can sympathize with their attitude, but at the same time one must concede that the ever-increasing costs of air trafficservices and allied equipment are due entirely to the increasing speed and size of modern aircraft and the steady growth of traffic.These must be paid by someone, and the Treasury is becoming more and more convinced that it is not that someone. If and when the charge is introduced perhaps justice could bedone to internal flights by removing the iniquitous tax of 2s 9d per gal on petrol used on such flights. Incidentally, paraffin paysonly 2.20d per gal, which seems hardly equitable. There seems little rhyme or reason behind this; or is it too much to expect thattaxation, in any form, should ever make sense? And the USA? EVER since 1945 the United States Government has been consider-ing a user charge for airways facilities. It was put forward by Mr Truman in 1947; by General Eisenhower in 1957; and thereafterspecific proposals were made in the Presidential "budget message" for the financial years 1959, 1960 and 1961. As far back as 1954 the House Committee on Appropriations said:"This committee has year after year called attention to the fact that the Federal Government is providing huge sums for airwaysfacilities and operations without reimbursement from the aircraft industry. The committee does not propose to continue indefinitelymaking recommendations for such large appropriations unless some system of airways charges is placed in effect which will returna substantial sum to the Federal Treasury. Action and not mere promises is what is needed and expected." Aviation gasoline pays a Federal tax of 4 cents per US gal, ofwhich 2c is refunded under provisions contained in the Internal Revenue Code whilst the remaining 2c (i.e., about 1 id per Imp gal)is transferred to the Highways Trust Fund. Jet fuels pay no Federal tax. Several States levy their own individual taxes, butthese are not relevant to the present discussion. Various schemes for raising revenue to pay for the airways havebeen considered. They ranged through: (A) Direct charges, by which a specific charge would be made for each flight-plan filed, each radio contact made or each part of the airways system used; but the administrative problems of assessing equitable charges, together with a possible reduction in air safety, ruled against this scheme. One can imagine some operators refusing to use all available facilities because of the cost. (B) Gross ton-mile charge for aircraft of over 4,5001b a.u.w;but to calculate this for 9,500 aircraft would be an unenviable task. Aircraft of under 4,5001b would pay an annual registra- "Aviation gasoline pays a federal tax of four cents per US gal": refuelling and apron services at Newark Airport, NJ tion fee according to gross take-off weight (and there are about68,000 such aircraft). (C) Aircraft mileage charge, revenue ton-mile charge and agross revenue tax: all there were considered but found wanting. (D) Charge on each ticket or way-bill. This would automaticallyleave out private and executive aircraft. In any case, there is already a 10 per cent Federal tax on all forms of transportwhich is not allocated to any specific purpose or fund. Almost every variation and permutation of these schemes wasexamined; but, judged against the criteria of equity, ease of collec- tion and safety none of them was considered satisfactory. The President, in a special tax message sent to Congress on April20 this year, recommended that the present 2c/gal tax on aviation gasoline be extended to jet fuels, that revenue from both should gotowards financing the airways system and that legislation should provide for annual increments of ic/gal on aviation fuels until theportion of the cost of the airways properly attributable to domestic civil aviation was substantially recovered by this tax. This recom-mendation implements, in the field of aviation, the Federal Govern- ment's general policy of imposing user charges in all areas where aGovernment service provides special benefits to individuals or groups. It is, perhaps, a significant pointer that the Federal tax ongasoline or diesel oil for road-vehicle used was raised from 2c/gal to 4c/gal on August 28, 1958, and this revenue is used for financingnew road programmes (a contrast to the 2s 9d per gal in this coun- try, which finances who knows what). The President has recentlyrecommended a further increase. It seems inequitable that jet fuel should have escaped tax,particularly since its consumption is increasing rapidly while the consumption of gasoline is decreasing at almost the same rate. AtAmerica's present rate of 2c/gal the yield from gasoline was esti- mated at S29m in 1960, and this figure is expected to drop at thefollowing rate: 1961, ?24lm; 1962, S20-3m; 1963, 5?18-3m; 1964, S164m; 1965, SI4-5m; 1966, S13-5m. This proposal would relate only to domestic movements, i.e., anyflight which has both its origin and destination within the 50 States. The concept of charging aircraft engaged in international aviationis specifically excluded. Military aircraft are likewise excluded, because there would be no net gain to the Government but onlyexpenses for book-keeping transactions. However, the substantial use made of the airways system by military aircraft has been takeninto account and their share of the cost is assessed at 29-9 per cent, leaving 70-1 per cent to be allocated to civil aviation. The Federal Aviation Agency has examined the fairness ofcharging the same rate for gasoline as for jet fuel. In their report they state that a Boeing 707 burns about 2,250gal/hr, a DouglasDC-7 about 570gal/hr and a DC-3 about 100 gal/hr. When these figures are converted into gallons of fuel burned per revenue ton-mile or per passenger ton-mile the differences are surprisingly small:— DC-3 . .DC-4 . . DC-7 . . B-707 .. Gal/revenue ton-mile0-739 0-5390-491 0-533 fiallpassenger ton-mile0074 00550048 0055 Furthermore, the FAA claims that jet engines are becomingmore efficient, that operators are learning more economical use of them, that jet fuel is generally 6 to 8 cents per gal cheaper thangasoline and, finally, that the increased cost of the airways is due in a large part to the more critical requirements imposed by jetaircraft. During 1959 aviation used 230m gal of jet fuel. In 1960 this hadrisen to 789m gal (about $151m of potential revenue at 2c/gal) and it is estimated that consumption will rise to 1,685m gal in 1962 and2,675m by 1966. The cost of the airways system was calculated by the FAA bytaking the maintenance, operational and administrative costs, allowing for depreciation of equipment and buildings, adding costsof maintaining and operating flight checking aircraft, adding
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