Orbit Tourism

Oregon Congressman’s proposal of imposing tax on Space Tourism

Oregon Congressman’s proposal seems to foretell that joyrides to space will soon become even more expensive due to new forthcoming taxation.

Not long after Richard Branson joined his first Virgin Galacitc’s fully crewed spacetrip and on the same day Jeff Bezos’ launched his first crewed space flight on 20 July 2021, Rep. Earl Blumenauer from Oregon (D., Oreg.) announced his intention to impose taxation on space tourism. Within his plans in particular is to propose a relevant law under the name Securing Protections Against Carbon Emissions (SPACE) Tax Act.

 There is no such thing as a …tax free launch

According to a statement issued by the Congressman’s office, “Space exploration isn’t a tax-free holiday for the wealthy. Just as normal Americans pay taxes when they buy airline tickets, billionaires who fly into space to produce nothing of scientific value should do the same, and then some”.

For the record, tickets for space tourism have reached $250,000 as far as Virgin Galactic’s price list is concerned, while Blue Origin still keeps in the dark the cost of its space tourism tickets. However, their prices do now show any signs of differentiate significantly. 

As Blumenauer, senior member of the House of Representatives’ Ways and Means Committee stated, “I’m not opposed to this type of space innovation. However, things that are done purely for tourism or entertainment, and that don’t have a scientific purpose, should in turn support the public good” sending out clearly the message that pure pleasure should pay a toll for the good of humanity.

A two levier tax

He also added that his tax proposal would likely have the tax levied on a per-passenger basis, in the same way travelers pay when using commercial aviation.

However, he made clear that “Exemptions would be made available for NASA spaceflights for scientific research purposes. In the case of flights where some passengers are working on behalf of NASA for scientific research purposes and others are not, the launch excise tax shall be the pro rata share of the non-NASA researchers.”

Although further details of the tax proposal have not yet been disclosed, it seems that there are going to be two taxation tiers: the one with regard to suborbital flights (beyond 50 miles above earth’s surface) and the other with regard to orbital ones (those exceeding 80 miles above earth’s surface). Blumenauer did not also provide any further information about the tax’s percentage for each case or about the state policies the collected revenue is going to fund.

However, as by his statement on CNN  Business it is easy for someone to make some assumptions regarding the taxation percentage that will be imposed :”Why should a family that is taking kids to Legoland pay a 9.5% ticket tax and other charges on their airline tickets and space tourists who spend a gazillion dollars have tax free tourism?” He also noted that his proposal is an attempt to bring the matter in the public dialogue, start a conversation and continue ahead with it

Where will the tax revenue go?

It is highly likely though, that all the tax revenue will be directed to policies against climate change because as Congressman stated, he is concerned about the potential carbon footprint of the space tourism industry once it expands. Something that is going to happen pretty soon having in mind Virgin Atlantic’s recent announcements regarding the launch of a space tourists’ shuttle every 32 hours (!). It is estimated that suborbital space flights emit 60-times more carbon footprints that commercial transatlantic flights on a per-passenger basis.

Space tourism companies have all been funded by NASA programs which have been in turn funded by taxpayers and so a part from the profit of their activities should return to taxpayers with some kind of benefit (environmental preferably). Fair enough. Besides, people who can afford an orbit trip ticket can undeniably afford its tax as well. Comments on the proposal from the thee leading businesses on space tourism have not yet been made.

Space tourism industry will grow substantially over the next years and as it seems not without contributing to society via taxation.

Sources:  Space.com Blumenauer.house.gov Finance.yahoo.com Medium.com

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