The majority of the Federal Aviation Administration’s (FAA) budget comes from the Airport and Airway Trust Fund (AATF), established by the Treasury Department in 1970 to support American aviation infrastructure. It collects revenue by taxing domestic flight tickets, international arrivals and departures, air cargo, plane fuel, and travelers’ purchases in loyalty and frequent flier programs.
Passenger taxes are applied at the time of ticket purchase. Domestic passenger tickets were taxed at 7.5% in 2023. Flights between the continental US and Hawaii or Alaska added another $10.60 per passenger. These taxes contribute to the FAA’s budget.
