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Garuda Announces End to Including the Airport Tax in Domestic Ticket Price Effective October 1, 2014

Garuda Indonesia has announced that effective October 1, 2014, the airport authority – PT Angkasa Pura, will collect separately the passenger service charge/airport tax now included in the price of an air ticket on Garuda.

Apparently Angkasa Pura has complained that it is exclusively their purview to collect the charge. Moreover, Garuda complains that losses of Rp. 2.2 billion each month due to airport taxes not paid by connecting flight passengers had to be made good by the carrier.

Meanwhile, there’s a contradictory regulation issued by the Department of Civil Aviation that decrees beginning September 9, 2014, the airport service charge should be included in the ticket price of all Indonesian airlines.

It now remains to be seen how Angkasa Pura will implement this decision and begin collecting the charge from all the domestic airlines flying from Denpasar.

Perhaps anticipating the chaos ahead, Garuda is recommending that passengers arrive early when checking in for a domestic flight.

As reported separately by Bisnis.com, the Minister of State-owned Enterprises, Dahlan Iskan said that while he understood Garuda’s decision to stem losses and remove a tax from their ticket price that made the national carrier’s tickets appear more expensive, the move of separating the tax from the ticket price is nonetheless a “very primitive” practice.

Iskan called on the Ministry of Transportation to address the problem and require the airport tax to be included in all airline tickets sold in Indonesia.

Garuda apparently chose to ignore the Ministry’s instructions, that should have required all other domestic carriers to conform to Garuda’s long-standing practice of including the tax in the ticket price.  This occured when Garuda determined that other airlines were ignoring the new regulation without suffering any sanctions.

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