If you have landed any time recently at Hartsfield-Jackson Atlanta International Airport, it’s nearly impossible to miss the message emblazoned on equipment and buildings across the airfield: Delta – Atlanta’s Hometown Airline.
We’re obviously proud of the more than seven decades that Delta has located its world headquarters in Georgia, and of our status as the state’s largest employer. We also take great pride in the fact that Delta has built the world’s largest global hub at Hartsfield-Jackson, helping to create a massive economic and job-creation engine for the state.
That’s why we’re puzzled that the Georgia General Assembly is considering one of the most business-unfriendly moves it’s seen in years, aimed squarely at Delta, a powerful force for economic and employment growth.
Nestled in the transportation bill currently under consideration by lawmakers is a measure that would hike sales taxes on jet fuel purchased by airlines doing business in the state. The tax increase would raise the current 3 percent rate to 4 percent. It would cost the airlines and our customers millions of dollars, while doing nothing to address the state’s roads and bridges.
That tax hike would be added to a jet fuel tax that is already among the highest in the nation. According to an analysis by industry group Airlines for America, Georgia’s effective jet fuel tax rate of 15 cents per gallon is higher than rates in New York, New Jersey, Minnesota, Washington State, Florida and many others. Some states, including Texas and Ohio, have no jet fuel sales tax at all, giving airline hubs in those states a competitive advantage over Georgia.
An increase in jet fuel sales taxes here would make it harder for established airlines like Delta and Southwest to expand in Georgia. It would likely make travel more expensive for consumers as airlines attempt to recoup the cost of the taxes. And it would make the state less competitive overall in attracting new airline service, ultimately reducing competition and choices for Georgia travelers.
That this tax increase is even being considered is unusual in Georgia, which was recently named the No. 1 state in the nation to do business by CNBC. The state’s pro-business policies have resulted in a string of business expansions and corporate relocations in recent years, reducing unemployment and fueling the statewide economy.
Central to that economy is Hartsfield-Jackson, home to Delta’s international hub. The airport generates close to $60 billion in economic activity for the state, and Delta alone employs more than 35,000 people statewide with an annual Georgia payroll of $3 billion.
While it would certainly damage the state’s vital aviation sector, the tax hike would do nothing to address the transportation infrastructure needs addressed elsewhere in the bill. That’s because under FAA rules, any money raised from jet fuel sales taxes above the current 3 percent must be used for aviation purposes.
There is little evidence that additional revenues are needed for the state’s aviation infrastructure, because Delta and other carriers have invested heavily in Georgia airports in recent years. Since 2008, Delta has worked with Atlanta leadership on more than $4 billion worth of strategic projects that have transformed Hartsfield-Jackson into a world-class international facility with a new international terminal, a fifth runway and central passenger terminal complex among other investments.
This ill-conceived tax increase has been opposed by the Metro Atlanta Chamber, the Georgia Chamber of Commerce, Airlines for America and thousands of airline and airport employees who want Georgia to remain competitive with other states for vital aviation business.
The AJC’s Editorial Board also recently spoke out against the jet fuel tax hike, calling it a “stunt” and asking Georgia lawmakers to remove it from the transportation bill.
Delta is proud to call itself a Georgia company, and proud of the impact we have on making Atlanta and Georgia a great place to live, work and do business. We hope the General Assembly makes the decision to support Georgia aviation, airline employees and Georgia travelers by eliminating the distraction of this damaging aviation tax increase, and focusing on the state’s real transportation needs.
