Will Space Tours Soon Become a Reality?
This is an article “Will Space Tours Soon Become a Reality?” by Marc Pulisci
While Virgin Galactic’s Sir Richard Branson and Blue Origin’s Jeff Bezos are probably singing David Bowie’s classic “Space Oddity” after experiencing the Overview Effect just a month ago, fellow billionaire Elon Musk of SpaceX is probably humming the golden oldie “Fly Me To The Moon”.
With most of us left dreaming of such out-of-this-world trips, these billionaires have created the best space tourism ad so far by flying themselves in suborbital space and showcasing various space crafts that can actually take us there.
The new Space Race
Many would think the potential of space tourism started when wealthy businessman Dennis Ito paid $20 million for a passenger seat aboard a Russian Soyuz and into the International Space Station (ISS) back in 2001. However, the concept has been mulled over by NASA since the ‘90s when the agency needed financial sources to fund their upcoming space programs. Now, with Virgin Galactic and Blue Origin wanting in on the action, space tourism is fast becoming a reality today for everyone more than it ever was in previous decades – or at least for the world’s millionaires.
Meanwhile, Musk is currently more focused on returning to the moon with the upcoming Artemis Missions in 2024 which aims to explore more of our natural satellite via a longer presence on its surface. Musk and his investors recently landed a lucrative deal with NASA for the program that lets the company enjoy federal incentives on grants, tax breaks, discounted loans, and environmental credits by up to $4.9 billion.
However, this doesn’t mean that Musk is not open to joining the new commercial space race soon. He isn’t going to let himself be left out of being part of the space cowboys billionaires club either as he already bought a ticket aboard one of Virgin Galactic’s commercial space flights.
Each ticket is initially sold at a whopping $250,000 per seat and will allow passengers to marvel at the Earth below in sub-zero gravity for a good five to seven minutes before re-entering the planet’s atmosphere.
Let’s talk about taxes
The Overview Effect is indeed a rare commodity that is rightfully valued by at least six figures. No doubt, there is big money in commercial space travel, and where the almighty green is concerned, taxes always closely follow. The industry projects eye-popping figures that it’s expected to reach a compound annual growth rate (CAGR) of 17.15% or at $2.58 billion by 2030.
These figures are probably what prompted the folks in Oregon Representative Earl Blumenauer’s office to author the Securing Protections Against Carbon Emissions (S.P.A.C.E.) Tax Act earlier this year. The Act aims to impose an excise tax on space tourism tickets that are treated as entertainment and leisure travel rather than official NASA rides to the new frontier. The bottom line is that commercial space travels will likely be similar to how any other commercial air travel is taxed. The only difference is that it will be two-tiered for suborbital and orbital travels and on a per passenger basis. Blumenauer further clarified that official NASA travels will be paid via the excise taxes derived from non-NASA passenger purchases.
The idea for the Act was unveiled on July 20 when Blue Origin launched its first manned spaceflight via its New Shepard spacecraft, highlighted by Jeff Bezos being among the crew members which also included aviation pioneer Wally Funk, student Oliver Daemen (who was a paying passenger), and Bezos’ brother Mark. Nine days before that, Branson flew to suborbital space via Virgin Galactic’s Unity spaceliner. Now that commercial space tourism is a reality, Blumenauer is ironing out the provisions of the SPACE Act in time for Virgin Galactic’s formal launch for its commercial suborbital flights.
Regardless of how high the price tags on space tickets may come as an eyebrow-raising public concern considering the many anomalies in these billionaires’ tax sheets, Blumenauer is firm on imposing the necessary taxes to jumpstart federal earning from the industry. But then, there is another factor that’s worth considering when it comes to imposing tax standards. Cryptocurrency may be a viable option to purchase tickets since space pioneers like Musk had earlier expressed support for such intangible assets as Bitcoin, Ether, and Dogecoin to name a few.
To date, there are some inconsistencies in how cryptocurrencies are defined in the financial industry and how the International Accounting Standards Committee (IASC) takes note of their values. While cryptocurrencies can be considered as digital cash, the IASC defines ‘cash’ as liquid investments that can be converted into amounts with a low risk of value fluctuations which makes their accounting a bit more challenging. For now, payments for space flights should be treated uniquely until international tax standards are enacted into law.
The future of space tourism
Virgin Galactic had publicly announced a good 600 reservations for their upcoming commercial flights starting next year at $250,000 per ticket. However, Branson hinted at lower ticket prices in the future to up to $40,000 if projections remain positive.
Meanwhile, Blue Origin maintains its $250,000 ticket price but may also be thinking of cutting down on travel costs considering Branson’s idea. SpaceX had also announced two planned space tourism launches for September as funded by billionaire Jared Isaacman, and by next year through Axiom Space. The two trips are estimated at $55 million considering there will be stays aboard the ISS for commercial passengers. That means SpaceX is clearly targeting the rich market for now but still eyeing new travel innovations such as international flights through space to significantly cut down on travel time and costs in the near future.
While both Blue Origin and Virgin Galactic tickets for the Overview Effect range between $200,000 to $250,000, SpaceX’s proposed country-to-country rocket flights still have no definite price tag but will use the same interplanetary rocket system for long-distance travel on Earth.
What passengers can expect is an upward flight in suborbital space where the spacecraft will traverse Earth’s orbit and re-enter the atmosphere less than an hour later and dock on the destination country’s landing pad. If this is the future of travel, then better save up now if you want to enjoy such out-of-this-world luxuries. For many, it will surely be a giant leap for travel technology with probably fewer steps towards the bank that such ticket prices are poised to break.