Taxes inconsistent when trying to use Velocity points

[NM]

Here is the tax breakdown for HKG-LHR Return as quoted by Virgin Atlantic call centre here in Australia

YQ Operating Airline Fuel & Insurance Surcharge - AUD 458.60
WY Australia International Passenger Service Charge - AUD 51.16
HK Hong Kong Airport Passenger Departure Tax - AUD 17.50
GB UK Air Passenger Duty - AUD 174.50
UK Passenger Service Charge - AUD 40.10

2 notable points here:

1. YQ for VS flights to and from HKG should be HKD505 according the Hong King Civil Aviation Department's approved rates as at 1st August 2010. So AUD458.60 must be calculated using a most unfavourable exchange rate.
2. Why is there are WY Australian International Passenger Service Charge applied to a HKG-LHR-HKG ticket?

I do believe a "please explain" is in order.

 

[Traveller4006]

Why is there are WY Australian International Passenger Service Charge applied to a HKG-LHR-HKG ticket?

I do believe a "please explain" is in order.

My small mistake, I forgot to delete this line WY when posting. All the other taxes are accurate.

 

[dajop]

Assume this is for upper class travel? I note bestflights (who are selling the tickets in Australia as well) quote $479 for taxes in Y, $651 in Y+ and $715 in J.

 

[Traveller4006]

From NM...

1. YQ for VS flights to and from HKG should be HKD505 according the Hong King Civil Aviation Department's approved rates as at 1st August 2010. So AUD458.60 must be calculated using a most unfavourable exchange rate.

I do believe a "please explain" is in order.

OANDA currency site quotes today HKD 1010 = AUD 143

Your suggestion of a "most unfavourable exchange rate" is a very polite understatement. Thanks for your sleuthing to help get to the bottom of this NM.

 

[NM]

Assume this is for upper class travel? I note bestflights (who are selling the tickets in Australia as well) quote $479 for taxes in Y, $651 in Y+ and $715 in J.

Hmm, interesting that there is a difference between Y+ and J "taxes". The GB Air Passenger Duty charge has two rates, the "normal" rate and the "discount" rate. The discount rate only applies to the lowest travel class available on the aircraft, so Y class in VS's case. The GB charge should be the same for Y+ and J fares. I am not aware of any other variation in the applicable taxes based on class of travel, unless VS are varying the YQ fuel surcharges based on class of travel - but I have not seen that done by any other airlines.

 

[dajop]

unless VS are varying the YQ fuel surcharges based on class of travel - but I have not seen that done by any other airlines.

SQ do as well, perhaps not as dramatically eg. MEL-SIN-MEL the +++'s are $310, $333 & $355 AUD respectively for Y, J & F. - being caused by variation in the YQ (AC)'s.

 

[PhilipA]

I agree the the numbers don't seem to stack up. However, with the greatest respect I would say that the location of the call center is irrelevant when it comes to taxation in Australia. I looked into this a little bit and as far as I understand, the tax law determines location based on were you are and also the location of the selling company. That they use an agent to take your money in another country doesn't change the fact that you purchased in Australia. This is the reason that companies like apple have to charge GST on Internet order under $900 even through they are not australian, the order is processed offshore and the item is sourced offshore. I know this isn't the full story but I believe it is generally .

Lets get over the inaccurate description of "taxes". There is NO tax or more correctly GST on international travel from Australia. There are a collection of fees & charges and "Fuel Fines" as NM eloquently describes them.

As for the Apple example above, the GST is due & payable when the goods enter Australia (though small amounts are regularly just ignored.) I could explain this a lot more - but it would be off topic completely.

The member "Velocity Rewards" should take care when describing the "taxes" and "taxation laws". For clarity, lets all use the proper term & code: Fuel Surcharge & YQ.

 

[Traveller4006]

As the responsibility of these taxes sits with the operating airline, please provide us with your contact details (via private message) and we will pass these on to Virgin Atlantic


to look into this for you. They are the appropriate people to help with your enquiry.​

I have tried to send a private message to you but as I haven't made enough posts here, the system wont let me. Therefore if you wish to know which Velocity member I am then please contact Ms Christalene Philip, operations manager, Velocity contact centre in Malaysia. Ms Philip is well aware of this issue, she knows what dates I wanted to travel. She will be able to confirm that she escalated the issue to Virgin Atlantic, that I had to wait 2 days for a response, and that the response when it cam back from Virgin Atlantic was that there was an "error" in the system.

That doesn't help me with my award travel because I am not prepared to pay the "wrong" taxes/charges.

Ms Philips will also be able to confirm the following:
- the total points quoted to me to redeem my "award ticket" on Virgin Atlantic as 187,000
- that I transferred additional 19,000 points from Amex with the intention of redeeming my award ticket
- the taxes were then quoted as $730
- the fact that I questioned this amount and wanted to know why they were inconsistent compared with other itineraries
- my frustration that a meaningful response still has not been forthcoming from Virgin Atlantic to Velocity to me

To travel from Brisbane to Hong Kong to London and return, I have now had to re-arrange my itinerary and have purchased a revenue ticket on Qantas for the entire journey.

 

[medhead]

Lets get over the inaccurate description of "taxes". There is NO tax or more correctly GST on international travel from Australia. There are a collection of fees & charges and "Fuel Fines" as NM eloquently describes them.

firstly "taxes" is used as a colloquial collective term for the various charges that you've mentioned
Secondly GST is not the only tax in Australia. Let me think, have you heard of departure tax.

As for the Apple example above, the GST is due & payable when the goods enter Australia (though small amounts are regularly just ignored.) I could explain this a lot more - but it would be off topic completely.

I suggest you read the customs website. all items with value less than $900 that cross the border into Australia and are shipped directly to an individual are not subject to GST. So on that basis items ordered from apple that are shipped from overseas directly to the customer (as is standard apple practice) of value less than $900 should not be subject to GST. However, apple do collect the GST on all items.

Note small amounts are not regularly ignored. GST is a tax that is applied on importation. There is a specific exemption in the legislation

The member "Velocity Rewards" should take care when describing the "taxes" and "taxation laws". For clarity, lets all use the proper term & code: Fuel Surcharge & YQ.

refer to point one above, clarity already exist as most people understand the usage. In fact they even understand +++

Edit for clarity where I say items above I mean shipments or packages, which may contain more then 1 item. In such case the $900 limit applies to the whole package not individual items. Oh and the limit could be $1000, just in case it isn't $900 I just wanted to put that out there for clarity

 

[Traveller4006]

As the responsibility of these taxes sits with the operating airline, please provide us with your contact details (via private message) and we will pass these on to Virgin Atlantic


to look into this for you. They are the appropriate people to help with your enquiry.​

I am still waiting for a detailed reply from Velocity Rewards about why the taxes/charges are inconsistent when I try to use Velocity points for award travel on Virgin Atlantic from Hong Kong to London return.

 

[dajop]

I am still waiting for a detailed reply from Velocity Rewards about why the taxes/charges are inconsistent when I try to use Velocity points for award travel on Virgin Atlantic from Hong Kong to London return.

I thought reading from your posts above that the charges were indeed consistent with what Virgin Atlantic charged commercially (from within Australia). The inconsistency seems to come comparing what VS charge compared to the theoretically regulated charges to/from HKG.

FWIW VS/DJ are not the only ones where such variation is seen. Last year booking a oneworld award booking using QFF pts, they originally wanted to ticket me in Singapore (where I live), but I managed to convince them to ticket in Australia using my Australian CC. That saved me ~$300AUD on the taxes/surcharges compared to the original quoted charges for ticketing in Singapore. For exactly the same itinerary.

 

[Traveller4006]

I thought reading from your posts above that the charges were indeed consistent with what Virgin Atlantic charged commercially (from within Australia). The inconsistency seems to come comparing what VS charge compared to the theoretically regulated charges to/from HKG.

FWIW VS/DJ are not the only ones where such variation is seen. Last year booking a oneworld award booking using QFF pts, they originally wanted to ticket me in Singapore (where I live), but I managed to convince them to ticket in Australia using my Australian CC. That saved me ~$300AUD on the taxes/surcharges compared to the original quoted charges for ticketing in Singapore. For exactly the same itinerary.

Thank you for your interest in this issue, but there is a clear error with the "fuel surcharge" for an itinerary HKG-LHR return. User NM kindly went to the trouble of looking up the correct charge and found it to be about 1/3 of the correct amount. Velocity have also told me it is wrong, but that there is "nothing they can do" until Virgin Atlantic fix it in their system. I wanted it fixed in a timely manner so that I could book my award travel. This has not happened so I declined to pay more than the correct amount for the privilege of using my points that I have earned as a member of the Velocity Program as well as points that I earned as a member of AMEX rewards program. As a result of Virgin Atlantic's tardiness in addressing this error I have made alternative arrangements and purchased a revenue ticket on Qantas from Hong Kong to London return in lieu of the award ticket on Virgin Atlantic. For the record the TOTAL "Fees/Taxes/Charges" including fuel surchage for the itinerary on my Qantas ticket are HKD2012 (approx AUD283) which is approximataly 1/2 the "Fuel Surcharge" amount quoted for the same itinerary on Virgin Atlantic. If Qantas can charge the correct fuel surcharge then why can't Virgin Atlantic?

 

[Velocity Frequent Flyer]

I am still waiting for a detailed reply from Velocity Rewards about why the taxes/charges are inconsistent when I try to use Velocity points for award travel on Virgin Atlantic from Hong Kong to London return.

Hi Traveller4006, We've passed on your details to Virgin Atlantic to respond to your queries.