The Airport and Airway Trust Fund has missed out on between $1 billion and $2 billion in the past 10 years, according to estimates from a report released Monday.
At the beginning of fiscal year 2006, Congress set the tax rates of both diesel fuel and jet fuel to $0.244 per gallon in order to prevent excise tax evasion after concerns were raised about jet fuel being bought for use in trucks. In addition, “ultimate vendors,” or jet fuel vendors registered with the IRS, are entitled to a refund of $0.025 per gallon.
The problem, according to many in the aviation industry, is that taxes from jet fuel go into the Highway Trust Fund until vendors file a claim for their refund.
The U.S. Government Accountability Office found that less than half of the tax receipts for sales of noncommercial jet fuel were transferred into the Airport and Airway Trust Fund since fiscal year 2006, amounting to a loss of between $1 billion and $2 billion. The congressional watchdog group attributes the low number of claim filings by vendors to the relatively small refund of $0.025 per gallon.
The Airport and Airway Trust Fund helps the FAA fund construction and safety improvements at airports and technological upgrades to the air traffic control system along with general investments in the nation’s airport and airway system.
