Toronto to raise Airport Improvement Fee and aeronautical fees on January 1, making flying more expensive
The AIF is used to fund airport capital projects, including terminals and runways
It will become just that much more expensive to fly out of or through Toronto in the new year, as the airport prepares to raise its airport improvement fee and aeronautical fees. The airport detailed its planned increases Wednesday to go into effect January 1.
Passengers leaving from Toronto will see a $30 facility fee tacked onto their tickets, up from $25. AIFs, as they are known, pay for capital projects, such as terminal expansions and runways. Airports also used AIFs to pay the debt on capital projects which last year stood at $15 billion at Canada’s 23 largest airports.
You see the AIF tacked onto your ticket every time you fly.
“The impact of the pandemic on Toronto Pearson’s business and Canada’s aviation sector has been nothing short of devastating,” said Deborah Flint, the President and Chief Executive Officer of the Greater Toronto Airport Authority in a statement. The GTAA is the non-profit organization that runs the airport.
Passengers connecting through Canada’s largest hub will pay a $6 AIF. Toronto is the only Canadian airport to charge the AIF to connecting passengers.
Traffic was down 85% in Canada over the summer, normally the busiest time of year. Canadian airports depend on passengers and the fees they pay for their revenue. The Canadian Airports Council estimated earlier this month that airports would lose $4.5 billion in revenue and increase their debt by $2.8 billion by the end of next year.
Fee increases: the new normal
The president of the CAC warned as early as May that fees could skyrocket as a result of the pandemic. Airports have joined airlines in calling for a federal bailout of the industry, which has yet to materialize.
Ottawa said last week it was aware of the challenges facing the tourism industry, but promised little in the way of aid.
“To further link our communities together, the Government will work with partners to support regional routes for airlines,” read Governor-General Julie Payette in laying out the Speech from the Throne. “It is essential that Canadians have access to reliable and affordable regional air services.”
Aeronautical fees in Toronto will also be going up three per cent January 1. These pay for airport operating expenses, such as terminal space, runway cleaning, and aircraft parking. The airport said this was the first increase in aeronautical fees in 13 years.
This is the first airport improvement fee increase in Toronto in 11 years, the airport said.
“These changes to aeronautical rates and the AIF follow more than a decade during which there were no increases to commercial aeronautical rates or the AIF at Toronto Pearson,” said Flint. “Today’s announcement will position the GTAA fiscally for continued investments in healthy travel and industry recovery.”
Toronto becomes the second Canadian airport to increase its fees as a result of the pandemic. Winnipeg raised its AIF to $38 at the beginning of the month.
Airports aren’t the only agencies raising fees as a result of the pandemic. NAV Canada raised its fees an average of 29.5% at the beginning of September to bolster its bottom line. Airlines complained the move would raise airfares and hurt their efforts to get people flying again.
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