I was contacted by a reader wanting to know how the new no-frills airline, Scoot, can charge less for a fare to Singapore than he pays in taxes and charges on Qantas.
The reader noted that regardless of whether he purchases a ticket or uses his frequent-flyer points to acquire one, he always pays a set impost level, which amounts to more than $450 on a return economy-class ticket to Singapore. Yet Scoot, which has just launched low-cost flights between Sydney and Singapore, has been selling fares from as little as $88 one way – less than the cost of the “taxes and charges” component collected by the national carrier.
How is this possible, he asks.
Is Scoot paying the same taxes and charges as Qantas? Is Scoot deliberately running its flights at a loss? Or does Qantas have a “profit component” or some other factor built into its taxes and charges?
Taxes and charges have long been a source of frustration for airline passengers – along with the travel industry – not only because they add up to such large amounts but because it is hard to make head or tail of them.
The Qantas website was little help, with a mock search for a return flight to Singapore bringing up a total fare of $1130 but… (click here to keep reading this article by Jane E. Fraser)
