Airlines ready to include airport tax in ticket prices

Domestic airlines say they are ready to include the passenger service charge (PSC), also known as airport tax, in their ticket prices, following a call by Transportation Minister Ignasius Jonan.

The minister recently called on all airlines to include this tax in their tickets, saying the tax and ticket must be in “one package”.

According to Garuda Indonesia sales and marketing director Erik Meijer, the national flag carrier was ready to comply with the call, as long as the practice was implemented in accordance with the standards set by the International Air Transport Association (IATA), of which it is a member.

“We are ready. The system is there because we already implemented it for two years,” he said on Thursday.

Garuda began embedding the tax in its ticket in 2012, but decided to drop the procedure in September 2014 as it suffered losses from uncollected payments.

It attributed the losses, which stood at around Rp 2 billion (US$164,217) per month, to differences between the information technology (IT) system that it used and that used by domestic airport operators, represented by Angkasa Pura I (AP I) and Angkasa Pura II (AP II).

Meijer said the airline had received numerous requests from its passengers asking for the tax be included in the ticket price again as it was more practical.

At present, the tax to be paid differs from one airport to another. It stands at Rp 40,000 per person for domestic flights from Soekarno-Hatta International Airport in Tangerang and Rp 75,000 per person at Ngurah Rai International Airport in Denpasar.

Meanwhile, the tax is set at Rp 35,000 per person at Kualanamu International Airport in Deli Serdang and at Rp 75,000 per person at Juanda International Airport in Surabaya.

Passengers must make the payment in cash at a separate counter at the airports.

Meanwhile, Sriwijaya Air corporate communication senior manager Agus Soedjono said that the private airline was ready to implement the practice, provided that a clear system and regulations were first put in place.

“We are waiting for the system to be developed by all Angkasa Pura companies because there are several issues that must be made clear,” he said.

Among the issues, he added, were those related to the tax implementation on multi-stop flights and payment collection between airlines and operators.

Audrey Progastama, AirAsia Indonesia spokesperson, said that the company would also support the tax integration policy as long as it was executed consistently across all airlines.

AirAsia Indonesia currently includes an “airport charges and fees” component in its ticket price for several routes, information on its website shows.

Separately, AP II corporate secretary Daryanto said that discussions were ongoing between the company and its fellow airport operator.

“We are still in the early stage of the system development. We have so far held informal talks with AP I and have not met with the airlines,” he said over the telephone.

AP II currently manages 13 airports, including Soekarno-Hatta and Kualanamu. AP I also oversees 13 airports, such as Juanda, Ngurah Rai and Sam Ratulangi International Airport in Manado.

Daryanto said that the company hoped all processes would be complete by December.