Canadians are no strangers when it comes to shopping for bargains in the United States. But what used to be trips south of the border for cheaper clothes and electronics are now becoming drives to the U.S. in order to catch a flight.
According to the Frontier Centre For Public Policy (FCPP), a Canadian think tank, about five million Canadians fly out of U.S. airports due to cheaper airfares every year, with another million Canadians saying they consider the option before flying. The think tank's report notes an average saving of about $428 per person, working out to over $1,700 in savings for a family of four. The potential savings have people talking after the report made its way onto Reddit yesterday, prompting a list of recommendations on Canadian airports and reportedly cheaper U.S. alternatives to try out.
The reason for the price differences — which can range from 30 per cent to 40 per cent depending on the airport — is one part politics and another part business. As the FCPP puts it, Ottawa's taxing policy is a move that affects the passenger. The Air Transport Security Tax, for example, adds up to $14.25 when flying domestic and up to $24.21 for flights that cross the border in order to fund security measures. In the U.S., airport security costs are covered mostly by the government.
Airfare Fees And Charges You May Not Know About. Story Continues Below
As the Toronto Star reports, passengers are charged a facility fee, which ranges from $5 to $40, depending on the airport. At Pearson International, the fee is $25 dollars, while at Buffalo Niagara International Airport, an airport that's less than a two-hour drive away, the facility fee is $4.50 per passenger.
Canadians also lose out on cheaper airfare due to a lack of competition, according to the Globe and Mail, echoing similar sentiments in the FCPP's 2013 report. More airlines mean more options for Canadian travellers, with the companies duking it out to offer the best value to would-be flyers.
Because of Ottawa's protectionist policies, airlines in Canada must be owned and operated by Canadians, effectively shutting out any foreign-owned airlines to fly between two Canadian cities. When compared to Americans, this lack of competition costs Canadians 50 to 100 per cent more for trips between Canadians cities of similar distances.
The double whammy of fees and lack of choice has had the government's attention for months now, though there's no word on any forthcoming decisions. Last June, Canada's Senate published a report suggesting the feds kill off the ground tax airports pay, since it just gets passed onto the consumer. In October, Finance Minster Jim Flaherty told reporters that Ottawa is "concerned" about the issue and that Transport Minister Denis Labell has been working with airlines and Canadian airport authorities to make headway.
But for the time being, it looks like Canadians aren't waiting around — and American airports, like Plattsburg International Airport in New York, are reaping the benefits, with reports that 75 per cent of its passengers are Canadian.
With files from the Canadian Press