Northwest Begins Refunding Taxes
Field, David, The Washington Times (Washington, DC)
Northwest Airlines said yesterday it will be the first of the big carriers to refund taxes charged to customers last year for travel this year.
A 10 percent airline ticket tax expired Dec. 31 and has not been restored. The excise tax and a $6 international departure fee are in limbo pending a budget agreement between Congress and President Clinton.
Since the tax lapsed, many travelers have turned to airlines seeking refunds on tickets they bought last year for 1996 flights, but the carriers have been referring them to the Internal Revenue Service, which issues a specific form for the refund of excise taxes.
As much as $500 million in tax refunds may be owed by U.S. airlines, although fewer than 10,000 people have filed formal requests.
Eagan, Minn.-based Northwest said it will refund about $35 million to its customers, who bought about 1 million tickets in 1995 for travel this year.
"Until recently the status of these taxes was unclear because of the budget debate and because the IRS had not articulated its position," Rolf Andresen, Northwest's controller and vice president of finance, said in a statement.
Northwest customers who purchased tickets by credit card will have the taxes credited to their card accounts. …