Luhut Reveals Government's Strategy to Lower Airfare Prices

Luhut Reveals Government Strategy to Reduce Airplane Ticket Prices

Dream - Coordinating Minister for Maritime Affairs and Investment, Luhut Binsar Pandjaitan, said the government will prepare a number of measures to lower airline ticket prices. This follows numerous complaints from the public who consider airline ticket prices to be expensive.

Luhut Reveals Government's Strategy to Lower Airfare Prices

Luhut conveyed that the reason for expensive airplane ticket prices is due to global flight activities that have recovered 90 percent compared to the situation before the pandemic.

According to IATA data, in 2024 there will be 4.7 billion global passengers, or 200 million more passengers than in 2019. Compared to ASEAN countries and highly populated countries, flight tickets in Indonesia become the second most expensive after Brazil.

"We have prepared several steps for flight efficiency and ticket price reduction,"
The following is the translation of the 'Bahasa' text to 'English' while preserving any html tags: "words expressed by Luhut in the Instagram post @luhut.pandjaitan, quoted on Thursday, July 11, 2024."

"Dream.co.id."

The government's steps taken, such as evaluating aircraft operation costs. Cost Per Block Hour (CBH) which is the largest component of aircraft operation costs, according to Luhut, this needs to identify the details of its formation. "We also formulate strategies to reduce the value of CBH, based on the type of aircraft and flight services," he said.

The government also plans to accelerate the policy of exempting Import Duty and opening Lartas for certain imported goods, for aviation needs where the maintenance portion is at 16 percent of the total portion after avtur.

The mechanism of tariff imposition based on route sectors implies the imposition of double VAT tariffs, Mandatory Contribution of Jasa Raharja (IWJR), and Passenger Service Charge (PSC) for passengers who transfer/change planes.

Another important thing is the evaluation of the role of cargo income in the income of airlines, which is often overlooked. "This can be a consideration in determining the Upper Limit Tariff. The government will also assess the possibility of incentives for Government-Borne Value Added Tax (DTP VAT) for some priority destinations.

"From the moment this meeting is conducted, all the above steps will be directly commanded by the National Flight Ticket Price Supervision Committee. They will evaluate the airplane ticket prices in detail every month."

end Luhut.

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Luhut Reveals Government Strategy to Reduce Airplane Ticket Prices

"We have prepared several steps for flight efficiency and ticket price reduction,"The following is the translation of the 'Bahasa' text to 'English' while preserving any html tags: "words expressed by Luhut in the Instagram post @luhut.pandjaitan, quoted on Thursday, July 11, 2024."

"From the moment this meeting is conducted, all the above steps will be directly commanded by the National Flight Ticket Price Supervision Committee. They will evaluate the airplane ticket prices in detail every month."

"We have prepared several steps for flight efficiency and ticket price reduction,"
The following is the translation of the 'Bahasa' text to 'English' while preserving any html tags: "words expressed by Luhut in the Instagram post @luhut.pandjaitan, quoted on Thursday, July 11, 2024."