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California has the highest base sales tax rate, 7.25%. Including county and city sales taxes, the highest total sales tax as of September 1, 2013, was in Arab, Alabama, 13.50%. [2] Sales tax is calculated by multiplying the purchase price by the applicable tax rate. The seller collects it at the time of the sale.
Thus all but a small percentage of the income from ticket sales is paid out to a wide variety of external providers or internal cost centers. Moreover, the industry is structured so that airlines often act as tax collectors. Airline fuel is untaxed because of a series of treaties existing between countries.
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