BA Avios ‘taxes and charges’ creeping up and miscalculated

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Whilst the oil price has been relatively steady since Autumn 2015, oscillating around the $50 mark for Brent Crude, that hasn’t stopped British Airways quietly sneaking up its ‘taxes and charges’.

On Wednesday we ran an article showing you the peak and off-peak Avios redemption dates for 2018.

As part of that article we did an example of a British Airways Club World redemption to New York, with a ‘taxes and charges’ figure of £529.

In April 2017, we ran a very similar article with the peak / off-peak calendar for 2017. Last April, the taxes for the identical flight were £480.

This represents an increase of £49, so £98 for a couple using a British Airways American Express 2-4-1 voucher.

If we look at Iberia, the taxes and charges for Madrid to JFK went up by just £14, from £145 to £159 return in Business Class. This means that the difference cannot be down to increased US airport and security fees. Part of the difference will be increased Heathrow passenger service charges, and £4 is down to increased Air Passenger Duty, but in general it does give the impression of BA arbitrarily increasing its ‘surcharges’ for no good reason.

BOAC poster

ba.com is still incorrectly showing taxes and charges

To make matters worse, on some routes ba.com has trouble accurately calculating the taxes and charges due. It always corrects itself by the time you get to the payment page but you should never treat the figure shown on the flight selection page as correct.

Here is a Club World redemption from London to Tokyo. The flight selection page shows taxes of £637:

….. but the payment page shows – correctly, if you compare with the charges on a cash ticket – that the total should be £539:

If you search for Edinburgh to Tokyo via London the error is even more stark. The flight selection page shows taxes of £740 per person:

…. instead of £539.

No-one is being overcharged here, but British Airways isn’t doing itself any favours by giving the impression that taxes and charges are (even) higher than they actually are.

PS. Visitors to our office will recognise the image above, because we have it – an original from the 1950’s – on the wall! Similar are available from Antikbar on Kings Road.

(Want to earn more Avios? Click here to visit our home page for the latest articles on earning and spending your Avios points and click here to see how to earn more Avios from current offers and promotions.)

Comments (61)

Lux says:

9 Jun9 June 10:49

You have an office?!
- Rob says:
  
  9 Jun9 June 10:58
  
  I think you underestimate how much work this is. US frequent flyer blog The Points Guy employs 15 people, 12 full time – not freelance – and based in a New York office. Skift, the travel news site which has an identical readership to ours (in page views) employs 35 people. I think Business Traveller employs 8 people and we are more than double their size in terms of UK online traffic. I could easily find enough work for another 2 people full time – we do no PR, we don’t have anyone travelling doing ad sales, we have no tech person (hence our ageing theme) etc. Anika and I have 20 days of travelling between us just in June.
  - Brighton Belle says:
    
    9 Jun9 June 11:10
    
    It’s time you sub contracted sleep 🙂
  - callum says:
    
    9 Jun9 June 12:09
    
    No offence intended (I obviously wouldn’t be here if I didn’t think you did a good job!), but this site is not remotely comparable to Business Traveller – UK page views is a completely irrelevant metric.
    
    Perhaps somewhat arrogant of me, but I’d go as far as to say a single person could easily run the whole thing, given a lot of the work you choose to do (replying to emails etc) isn’t necessary for the operation of the site.
    - Fenny says:
      
      9 Jun9 June 12:59
      
      A smallish but significant reason that I read this site and recommend it to people, whereas I don’t recommend other sites, is the personal touch. Rob and Anika are not “faceless” bloggers and there is definitely a more interactive feel to the place. Changing it would not necessarily be a step in the right direction.
      - Leo says:
        
        9 Jun9 June 16:38
        
        +1
      - zsalya says:
        
        10 Jun10 June 13:31
        
        +1
    - Lawro says:
      
      9 Jun9 June 13:45
      
      @callum
      
      I think you underestimate how much work must go into writing 3 content pieces each day, 7 days a week!
      - Anna says:
        
        9 Jun9 June 14:37
        
        By 6 a.m.!
      - Rob says:
        
        9 Jun9 June 15:40
        
        Dull content is straightforward. Interesting content – with the mix of competitions, exclusive stories (which don’t come out of nowhere), reviews etc is time consuming. Running it as a profitable business is both very difficult and time consuming.
    - aliks says:
      
      9 Jun9 June 16:10
      
      Actually there are lots and lots of points and travel sites that are run by a single person in exactly the way you suggest.
      
      Those sites don’t get much traffic . . . . . . .
    - Worzel says:
      
      9 Jun9 June 17:45
      
      Callum 12:09 :
      
      Whereas i’ve appreciated (and understood) your sometimes alternative viewpoints in the past, you might want to reconsider your comments earlier today.
      
      Should you wish to set up an operation similar to Rob’s, I’m willing to put in £100 as a start up fund!
      - callum says:
        
        9 Jun9 June 20:04
        
        Not really, no.
        
        I didn’t say Rob doesn’t work hard – but it seems like a fact to me that writing 3 (usually very simple that are often found elsewhere first) articles a day doesn’t take much time. In response to people whinging in the past (I hoped my clarification that I think he made a good job made it clear I wasn’t whinging about him at all!), he’s pointed out that a large proportion of his time is spent answering emails, reading comments, making connections etc. – something that is great for the people being replied to, but isn’t at all necessary for the running of the site.
        
        Though the only reason I really objected was the comparison to the likes of Business Traveller! Page views are 100% irrelevant. They show he’s successful (and he fully deserves it), but they do not show the level of work it requires to run.
        
        Finally, I’m pretty lazy so I doubt I’d start a blog – actually pay me the £100 and I will though! (And like with many reviews of products – I tend to comment when I disagree and not when I agree, which may make me look very combative, so this seems like a good time to say thanks for the great site Rob!)
      - Alan says:
        
        10 Jun10 June 01:26
        
        You’ll love Making Tax Digital then when that comes along 😉 I used to do quarterly VAT in a couple of hours but I’ll admit it was fairly straightforward when only a couple of customers!
    - the_real_a says:
      
      9 Jun9 June 18:39
      
      I once wrote 3 articles for the companies blog… took me the best part of a week! Never underestimate how much effort needs to be put it.
      - John says:
        
        10 Jun10 June 00:06
        
        The personal touch Rob adds to this site is the value in my opinion . I have sent and received mails back from Rob giving me advice when I requested it on several occasions . Other sites do not have this level of service !
        Keep up the Great work Rob !
    - Mr Dee says:
      
      10 Jun10 June 00:02
      
      Here is the thing, a simple blog with quickly written articles without due care and attention to the readership could be done in an hour a day, but full quality articles that are relevant to the readership and build a following is another story entirely.
      
      To then plan and keep your readership with information that is relevant whilst at the same time running the thing as a business that isn’t selling out to irrelevant advertisers is the hard part.
  - Lux says:
    
    15 Jun15 June 06:13
    
    Just teasing Rob! I know it’s a lot of work and you’re always responsive to mails. I remember you writing of working out of day rooms in London, so good that you’ve upgraded. Congratulations on the blog’s success.
Neil says:

9 Jun9 June 11:46

Another great article Rob! I was about to send you an email today in regards to GRU – LHR! I booked a CW redemption yesterday and the taxes were nearly 3 times higher than they were yesterday. I am calling BA today to question it.
James says:

9 Jun9 June 19:24

O/T – I took advantage of the printer cartridge Tesco deal recently and now have a load of points to convert to Avios.
It seems however I have to wait until the next quarter for them to convert. I was under the assumption I could convert at will (I normally have it set to automatically convert)
- barey cutters says:
  
  9 Jun9 June 19:45
  
  Points convert to vouchers every 3 months
  Only then can you manually or automatically transfer to avios.
- callum says:
  
  9 Jun9 June 20:06
  
  You’ve never been able to convert Tesco points to anything at will – even in store. They announced a while ago that they’re working to allow that though.
Nick says:

9 Jun9 June 21:10

I really hope that this becomes the next ppi. It’s disgraceful mis pricing. The banks got hammered for their mis selling, I really do think it’s time ba to their comeuppance for the bogus labeling of their taxes and charges. At the very least these fees should be refundable in the event of cancellation.
- mark says:
  
  9 Jun9 June 21:21
  
  They are refunded in the event of cancellation.
  
  You are also misguided with the PPI rant. BA tell you exactly what you are being charged for, the choice is yours to either pay for the flights, or not.
  
  The charges are ridiculously inflated, but that’s a different issue.
  - Roger C says:
    
    9 Jun9 June 23:23
    
    While I can see that it’s not the same as PPI, the last time I booked on the phone the agent was insistent that all the fees for my redemption flight were government taxes. When I pointed out that much of the cost was made up of BA charges over which they had complete control he denied it entirely. So I don’t buy the ‘tell you exactly what you are being charged for’ argument.
    - mark says:
      
      10 Jun10 June 09:41
      
      well that agent was misinformed, the point however is you are being told what the cost is, and there is nothing about it that is “optional” hence the PPI analogy doesn’t hold. I dialled up a dummy booking just now in F to SFO and of £570 in taxes and fees, £240 was govt taxes with the £370 balance being BA ‘fees’. Crazy high but until we all start voting with our feet that isn’t going to change. People like BAEC and continue to be prepared to foot the bill of keeping it going.
      - Genghis says:
        
        10 Jun10 June 09:48
        
        I’d be happy if I was “under charged” because the two numbers didn’t add up correctly
Henry says:

10 Jun10 June 13:00

There’s a lot of complexity to how fuel and currency fluctuations flow through to prices for airlines. I’m struggling to find information on BA’s hedging policy (it may be considered a trade secret), but based on airline industry norms and some of the statements in their annual report, we can assume a rolling hedge policy going out 5 years for both fuel and currency (c. 100% hedged for the next 12 months, 80% at 24 months, 60% at 36 months, etc. – though these percentages could differ wildly and I’m purely speculating).

With this assumption, we can derive that only around 40% of the savings from halving of the oil price 2 years ago will be felt by BA over the next 12 months (with another assumption built in that jet fuel is directly correlated with oil price – it probably isn’t). From BA’s perspective, their oil costs would only be 20% lower than 2 years ago after accounting for hedge losses.

Conversely, BA will only be feeling around 20% of the decline in GBP vs. USD (c. 20%) over the next 12 months. As oil (and fuel) is priced in USD, that would make it c. 4% more expensive.

If BA took their hedges into account when pricing and passed on all of the savings, we should see fuel surcharges around 16% lower than last year.

Remember though that the US duties are also priced in USD – so BA will see not only an increase in the underlying charge, but will feel the currency impact of these charges, thus the net increase is the incremental increase plus 4% of the whole charge (again assuming that they are hedged to 80%; if not, it’s higher).

Given that there have been increases in the underlying fees, there is substantial currency weakness, and it’s unlikely that the full benefit of the oil price fall will be felt by BA, I think a 10% increase in the charges is not unreasonable.
travelbear38 says:

10 Jun10 June 15:31

Is Aberdeen and Jersey the only uk airports where the tax is much lower?
thanks
- Rob says:
  
  10 Jun10 June 15:49
  
  Inverness and Jersey. Flybe from Newquay to Gatwick too but no use on a 241.
Allan says:

12 Jun12 June 20:30

Here is an anomaly – I just searched for F redemption LHR-KUL and shows 1 seat. Then I search same day but EDI-KUL and it shows 2 seats.
Ever seen that before?
- Rob says:
  
  12 Jun12 June 21:12
  
  BA.com sometimes incorrectly shows the number of seats on the connection for both legs. It won’t be bookable.
  
  Some airlines, inc Iberia but not BA, do show different availability for regional members who connect to a long haul.
  - Allan says:
    
    13 Jun13 June 00:24
    
    Had a moment of excitement there!