Experts Question Travel's ‘Hidden Fees' and Taxes

Often, advertised travel prices for hotel rooms, flights and rental cars don’t include extra charges, such as taxes, fees and destination charges, sometimes called "hidden fees," according to The Columbus Disptach (Columbus, Ohio).

Rental car rates usually include three to eight surcharges, adding up to an additional 20 to 25 percent of the cost of the basic daily rate, reports Richard Lewis of Richard Lewis Travel in New Albany.

Unfortunately, taxes on travelers are increasing all the time, said Andrew Chamberlain, a staff economist at the Tax Foundation, a tax-policy research organization in Washington. Chamberlain is researching a paper on soaring state and local rental-car excise taxes.

Travel taxes, such as those on rental cars, are "viewed as falling on visitors who can’t vote against them. And the rental-car industry is fragmented and not very powerful politically," he said. Traditional taxes, such as property or sales taxes, are getting harder to raise, and lawmakers are following the path of least resistance to find funding sources, Chamberlain said.

Many locations are imposing rental car surcharges to pay for projects that local taxpayers are unwilling to fund themselves, Chamberlain said. Taxes and surcharges that travelers might find added to their rental-car rates include state and local sales taxes, convention center/stadium/arena taxes, parking taxes, airport concession fees and peak-season surcharges, plus add-on insurance, The Columbus Dispatch reports.

Lewis said many savvy travelers rent cars at downtown locations or at their hotels to avoid airport rental-car surcharges. For most travelers, though, the hassles aren’t worth the savings, Lewis said.

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