As a pilot I can tell you that we get a MSL (Mean Sea Level) pressure reading 
and key that into the altimeter which compares it with current pressure and 
gives altitude to +50ft/-75ft accuracy.

The MSL is provided by the local airport, is adjusted to ensure any regional 
error puts us higher than any obstacles, and it varies so the airport will 
alert us if and when it changes.

Above what's known as the Transitional Layer we are high enough to avoid all 
ground obstacles to we use standard pressure of 1013.25 mb so that aircraft's 
altitude is computed relative to each other.

We do heed GPS altitude warnings that we're about to bust airspace but not for 
accurate altitude measurement.

Hope that helps.

Cheers
Steve

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