Sunday musings: Leno spoofs merger, Florida’s illegal tourist drivers, redeeming miles gets very taxing

by Charlie Leocha on February 24, 2013

The Tonight Show leaves its audience and the announcer laughing with their spoof about the AA/USAir merger. Florida’s law creates a tsunami of illegal drivers. What will insurance companies do? Finally, we take a look at the amazing amount of taxes and airline-imposed fees being added to frequent flier tickets. Beware.

Tonight Show spoof about AA/USAir merger
The Dallas Morning News ran this spoof video about the American Airlines/US Airways merger. Depending on the city-pair, there is a lot of truth to the video.

New Florida law makes many tourists illegal drivers

Florida passed a law requiring all rental car drivers from outside of the United States to have an International Drivers Permit, similar to some European countries like Italy.

While you may never be asked for your license by the rental car company and may never be stopped by the police, if you have an accident, your insurance may not pay if you are not carrying the required international drivers permit (IDP). Consider it an insurance policy supplement.

Foreign drivers in Florida with perfectly good Canadian, British or Australian drivers licenses often do not feel they need a translation (which is about all the international drivers permit is) since their licenses are already in English. But, in the eyes of the law that requires an IDP, there may be insurance claim problems if there is a fender bender or crash without the proper paperwork.

Consider this more of a warning story about renting a car anywhere rather than only a story about Florida. When traveling internationally, invest in an IDP from AAA.

The law, which went into effect largely unnoticed on January 1, requires foreign drivers to have an international driver’s permit from their home country.

The intent was to make sure all drivers in Florida held a license translated into English, but many frequent visitors from Canada, the UK and other English-speaking countries have visited the state without knowing they needed the documentation.

The Canadian Automobile Association is warning members that insurers may not pay claims for any accident they have while driving without an international drivers permit in Florida.

“Every single time someone drives without an IDP, it’s a risk,” said Kristine Simpson, public relations manager for the CAA in Ottawa, which sounded the alarm last week.

Are “free” frequent flier trips getting too “taxing” to cash in?
Recently, I needed to fly from Washington, DC, to Frankfurt, Germany. The online travel agent price was about $1,000. So, I decided to try to see if there were frequent flier trips available using my tens of thousands of American Airlines miles. To my surprise, there were. However, the trips were via British Airways with a connection at London-Heathrow and far more taxes and “fees” than I had imagined.

Not only would I have to redeem 40,000 miles (a relative bargain) but an additional $450 or so. ( actually warns FF travelers redeeming miles that some taxes and fees range up to $700.) If I value frequent flier miles at $1/mile, that’s a total effective cost of $850. Hardly free. Plus, if you figure in the FF miles that you would accrue by purchasing the $1,000 ticket — about 9,000, worth around $90 — that makes your net savings realized by using FF miles only about $60. Hardly worth it.

But in recent years, many mileage programs have introduced rule changes, tiered award charts and a la carte fees that have shifted the options. Among the wrinkles:

– Taxes and fees: Government-imposed taxes and fees are unavoidable and can be steep, reaching as much as $200 per economy ticket on flights leaving from London’s Heathrow Airport.

Other fees vary by airline. For instance, though I was using American’s website to book my Rome award tickets, the available flights I was seeing were on British Airways. It and some other foreign carriers have levied “fuel surcharges” — which accounted for the whopping $700 fee on those tickets to Rome.

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  • Jonathan_G

    “Government-imposed taxes and fees are unavoidable and steep…”

    The government doesn’t impose the steep fuel surcharges. Those really should be part of the ticket price; it’s not as if they’re a varying surcharge that’s indexed to either the price of oil or the cost of fuel to the airline. At the very least, if the fuel surcharges remain separate, they should be part of what’s included in the purchase paid for with miles.

  • BobChi

    British Airways is the notorious standout in the area of “fuel surcharges” on award flights, and the U.K. is the notorious standout for government taxes. These are not fees put in place by American. Use your AA miles on AA itself or on other partners that do not impose these fees. Never ever use reward miles to fly BA to or through London.

  • BobChi

    You are quite correct, and on their own flights and most partner flights U.S. based airlines do not impose these charges for reward tickets. Only a few foreign carriers do, BA being probably the worst.

  • wiseword

    Do British airports other than Heathrow impose such high fees? What about Stansted?

  • Charlie Leocha

    The Air Passenger Duty (APD) is an excise duty which is due on passengers being carried from a UK airport on aircraft.

    The rate of APD depends on the passengers’ final destination. There are four destination bands based on the distance between London and the capital city of the destination country/territory. Each destination band has two rates of duty depending on the class of travel, so there are eight different rates of duty in total.

    The distance used to calculate the new rate of APD is the distance between London and the capital city of the destination country as summarized below:

    Band A (0 – 2000 miles) £13 (about US$20)
    Band B (2001 – 4000 miles) £65 (about US$104)
    Band C (4001 – 6000 miles) £81 (about US$130)
    Band D (over 6000 miles) £92 (about US$147)

    Premium flights, basically private jets and all-business-class flights, pay double.

    Yes, this is charged from all UK Airports. There are some exemptions for flights in and out of Belfast.

  • ton lammering

    actually it is a international thing not a carrier thing, i am dutch and have a nice number of skymiles, i checked and a flight from europe to the usa would still cost me nearly 400 euro’s in taxes etc. given that a ticket goes from about 580 euro that is stupid, so i just bought a ticket and used them for internal flights in the usa

    paid usd 5 costs.

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