British Airways Denied $5.6 Million Refund for Miles Program Tax

British Airways PLC isn’t entitled to a $5.6 million refund for excise taxes on payments made to US domestic airlines from 2011 through 2015, the US Court of Federal Claims said.

Members of British Airways’ frequent-flyer program can earn miles by flying with several US domestic airlines because the UK carrier compensates those airlines for the miles they award to its passengers. British Airways sued the US in 2019, challenging the IRS’s assertion that a 7.5% excise tax applies to the compensation payments made to the domestic airlines.

British Airways previously filed administrative claims with the IRS for refunds of ...