Redemption Taxes and Fees Again

Just having a browse and I see that G class redemption taxes and fees for the US are now at £1197 for a return and £724 for a single!

BA seem to be similar now too although there’s a slightly broader range of options.

[mitchja]

Indeed, YQ looks to have increased again by another £200 to £900 now on Upper Class return rewards fares

That’s extortionate.

Just looked up an LAX return. If we’re valuing Avios the same as VS points…

VS, 145,000 + £1200
BA, 152,000 + £680

I still have a soft spot for all things Virgin (I type this post from the Virgin Hotel in NYC), but 95% of my flying has moved to BA since their wider introduction of club suites.

Thank you for flagging this as we’re still currently paying for the Mastercard. Unsure how to justify continuing when ex-EU fares are the same price, or even lower.

Wow. That’s getting a little expensive now. I wonder if that’s why there’s been so many promotions lately on spending / buying miles. It’s beginning to get a lot like DFS

It wasn’t that long ago when it was £500 ish.

David

HFP’s has picked it up this morning.

A lot of very unhappy people and I don’t blame them.

David

Quick question for those not in the know! Currently I am booked return UC MAN-MCO but my grown up kids decided to return PE to save a few £ in tax. Now my daughter is considering that if there is availability, she may upgrade (points upgrade) - would she now have to pay the different in taxes between what she originally paid for PE and UC, or what the difference is now between PE & UC? I suspect the former which will probably rule it out! Thanks

It would be the difference between what she paid for PE to the new UC charges.

How can Virgin justify this amount of YQ tax? Didn't the YQ replace what was originally the fuel surcharge some years ago, when fuel prices fell & the airlines could no longer justify it?

Then the YQ started to creep in and for quite a long time Virgin & BA charged pretty much the same in taxes / fees / charges on redemptions - not that they colluded, as that would be illegal.

As above, I would be interested to know how Virgin justify this increase? I've had good and both flights on both Virgin & BA over the years - it's the same on both airlines, you either get a good switched-on crew & a good flight experience - or a mediocre lazy crew with a flight experience to match.

Thanks Mike - I suspected that this would be the case, just trying to work out what that would be but possibly twice what she originally paid!

Yes it seems they have not increased taxes but increases the carrier surcharge. Compared a new booking to a current one. New booking 2 adults return in UC is now £1,800 where it was £1,400!! I think it’s disgusting! Cannot justify when sometimes during sale you can get LHR-JFK UC cash ticket for £3,200 and you earn points on those and can use less points to deduct some money off…. I am thinking maybe they increased as they have had Point sale (up to 70% bonus) and then also reward seat sale

Let's just be clear here...

Taxes are set by the government of the departing and arriving country (most of them anyway - some are airport fees set by the respective airports). You can see this breakdown in the fare details or on your e-ticket if you're interested. Naturally this changes per route.

The line item that says "YQ" or "Carrier imposed surcharge" is a stealth fee that all airlines use. It varies depending on internal parameters set by revenue management. You'll see it move for a lot of reasons, economic and oil price related reasons are very common. (Although most airlines are hedged on oil 12 months out, so often you see a 12 month lag in oil related increases or decreases.. thats complicated and beyond the scope of this post).

The real reason YQ actually exists from a ticketing point of view, has little to do with reward fares (although it makes up the bulk of the reward fare "fee" portion nowadays); it exists to act as a global price modifier. Consider this... airlines have hundreds of thousands, if not millions of different fare combinations. They're priced on a sliding scale, inflexible fare buckets being the cheapest and the most flexible being the most expensive. Let's say an airline all of a sudden decides/needs to reprice all fares on a particular route or a region. They'd have to reprice thousands of fares manually or at the very least their ticketing system would. That's where YQ comes in. It allows airlines to easily do things like "Add £200 to every ticket combination that meets X criteria". This is true of revenue fares as well as reward fares. A lot of VS revenue fares, actually have YQ in too.

Anyway, boring ticketing waffle over...

This is pretty bad timing for VS. Hiking YQ when they're under performing compared to BA and other transatlantic carriers is completely moronic. But entirely predictable big business, out of touch with their customer base behaviour.

This will likely go the same as it always does... there will be some uproar, maybe they realise how many people are pissed (maybe they don't) and then the fees should drop down again to a more reasonable level at some point. Only revenue management know if/when. I do agree that the timing of this with the reward seat sale and recent points offers is very suspect. Give with one hand, take with another.

Let's just be clear here...

Taxes are set by the government of the departing and arriving country (most of them anyway - some are airport fees set by the respective airports). You can see this breakdown in the fare details or on your e-ticket if you're interested. Naturally this changes per route.

The line item that says "YQ" or "Carrier imposed surcharge" is a stealth fee that all airlines use. It varies depending on internal parameters set by revenue management. You'll see it move for a lot of reasons, economic and oil price related reasons are very common. (Although most airlines are hedged on oil 12 months out, so often you see a 12 month lag in oil related increases or decreases.. thats complicated and beyond the scope of this post).

The real reason YQ actually exists from a ticketing point of view, has little to do with reward fares (although it makes up the bulk of the reward fare "fee" portion nowadays); it exists to act as a global price modifier. Consider this... airlines have hundreds of thousands, if not millions of different fare combinations. They're priced on a sliding scale, inflexible fare buckets being the cheapest and the most flexible being the most expensive. Let's say an airline all of a sudden decides/needs to reprice all fares on a particular route or a region. They'd have to reprice thousands of fares manually or at the very least their ticketing system would. That's where YQ comes in. It allows airlines to easily do things like "Add £200 to every ticket combination that meets X criteria". This is true of revenue fares as well as reward fares. A lot of VS revenue fares, actually have YQ in too.

Anyway, boring ticketing waffle over...

This is pretty bad timing for VS. Hiking YQ when they're under performing compared to BA and other transatlantic carriers is completely moronic. But entirely predictable big business, out of touch with their customer base behaviour.

This will likely go the same as it always does... there will be some uproar, maybe they realise how many people are pissed (maybe they don't) and then the fees should drop down again to a more reasonable level at some point. Only revenue management know if/when. I do agree that the timing of this with the reward seat sale and recent points offers is very suspect. Give with one hand, take with another.

Indeed, it does feel very suspect with all the sales that have happened to hike the YQ. Thank you for the explanation of taxes / fees. My earlier post was in regards to specifically reward seats.

For example; say if I bought points during the sale, 200,000 points (+ 140,000 additional bonus) = 340,000 points for £3,000GBP.
190k points would cost £1,676 (3,000 / 340,000 x 190,000). Plus now £2,400 races and fees is over £4k.
Well you can buy UC cash seats for that price or less …

And I asked them on Twitter/X and they replied saying government taxes have increased and that’s why the costs has increased… but yet it’s not the taxes that have increased it is YQ surcharge.

Indeed, it does feel very suspect with all the sales that have happened to hike the YQ. Thank you for the explanation of taxes / fees. My earlier post was in regards to specifically reward seats.

Oh don't worry, I wasn't singling anyone out, just using this as an opportunity to explain YQ in a bit more detail

For example; say if I bought points during the sale, 200,000 points (+ 140,000 additional bonus) = 340,000 points for £3,000GBP.
190k points would cost £1,676 (3,000 / 340,000 x 190,000). Plus now £2,400 races and fees is over £4k.
Well you can buy UC cash seats for that price or less …

And I asked them on Twitter/X and they replied saying government taxes have increased and that’s why the costs has increased… but yet it’s not the taxes that have increased it is YQ surcharge.

Yeah, to be honest... even some ticketing agents understanding of YQ is basically zero. I wouldn't expect the social media team to know anything about this other than whatever corporate BS they've been told to pedal.

[mitchja]

This will come as no surprise what so ever, but according to HfP BA have now also increased their YQ to the same levels as well.

Wasn't YQ originally just the fuel surcharge and it has now morphed into something much bigger?

I booked a points and companion flight on Saturday, I was told to email customer services as they may be able to refund the overnight increase. I got a response claiming as it is a tax VA can’t do anything, I have replied pointing out it is their fees that have increased, still waiting for a response. I have just done another dummy points booking and all points upper flights have been reduced to £978 for Man to Mco for most dates. Maybe it was a glitch?

[mitchja]

Well spotted! All very odd. No idea what is going on as YQ on Upper reward flights seems to be back down to £700 today?

All very strange, now to try and get VA to refund me £400 as it must have been a glitch?

I booked a points and companion flight on Saturday, I was told to email customer services as they may be able to refund the overnight increase. I got a response claiming as it is a tax VA can’t do anything, I have replied pointing out it is their fees that have increased, still waiting for a response. I have just done another dummy points booking and all points upper flights have been reduced to £978 for Man to Mco for most dates. Maybe it was a glitch?

Yes the fees have come back down to normal now. Must have been a glitch, or they are going to increase them but not right now…

Definitely call them back and ask for the refund .. worst case is to cancel and rebook or make a Change .. I don’t know if they will sort it out over email, as they could just say you’ve booked at a published rate. I always find agents in Swansea the best to deal with

All sorted over the phone, they agreed to refund just short of £400

All sorted over the phone, they agreed to refund just short of £400

Well done and a good result.

I had a separate issue with VS last week and I was shocked how responsive and how quickly they resolved it, they generally are very good at putting right what goes wrong!