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Airport tax changes at Malaysian airports

by on November 1, 2016
 

The long awaited announcement on the Passenger Service Charges (PSC) levied at airports in Malaysia, was made by Malaysian Aviation Commission (Mavcom) on 31st October 2016. Also known as Malaysian Airport tax, the changes take effect for tickets issued from 1st January 2017 and are expected to contribute to the development of a framework to improve airport service levels.

The changes are also part of a realignment of the charges between airports within the country, particularly the difference in charges levied at the main KLIA terminal and those at KLIA2 which caters to Low Cost airlines. Full equalisation is expected by 2018, following a review of the PSC to be conducted in 2017 with a view to making the PSC the same at both airports.

In summary, there are increases in charges for passengers flying out of all airports, with the exception of those travelling to ASEAN countries out of KLIA and other airports, which will see the current charge of MYR65 reduced to MYR35 for all airports. For passengers out of KLIA2, this will increase by MYR3 to MYR35.

Malaysian Airport tax changes

   Current PSC (MYR) Revised PSC, effective 1 January 2017 (MYR)
 

Domestic

ASEAN Int’l Domestic ASEAN Int’l (excluding ASEAN)

KLIA

9

65 65 11 35

73

KLIA2

6

32 32 11 35

50

Other airports

9 65 / 26* 65 11 35

73

Source: MAVCOM

* Special rate for departures from secondary domestic airports excluding KLIA, klia2, Penang, Kota Kinabalu, Kuching, Langkawi and Johor Bahru to ASEAN destinations.

Airline Responses

In immediate responses, both Malaysia Airlines (the principal airline using KLIA) and AirAsia (anchor airline in KLIA2) have issued statements regarding the changes.

Malaysia Airlines has focused on the reduction in charges to ASEAN destinations, with emphasis on the potential for developing close regional routes across ASEAN to further develop the tourism potential.

AirAsia, though happy that they will still enjoy a price advantage over airlines using KLIA in the wider international market, is disappointed with the equalising of charges for domestic and ASEAN sectors as these represent an increase of charges that will be passed on to passengers. In their joint statement, Aireen Omar, AirAsia Berhad CEO and Benyamin Ismail, AirAsia X Berhad CEO, noted that Malaysia is the only country that has seen a drop (of 6.2 per cent) in international visitor arrivals in 2014 and 2015 compared to other Asean countries.

The statement went on to note that facilities at KLIA2 are not at par with those offered at KLIA…

In terms of equalisation, AirAsia and AirAsia X passengers deserve the same user experience in KLIA, and before charges can be equalised, the facilities at the two airports should be made equal to each other, otherwise, we are happy to consider moving AirAsia and AirAsia X operations to KLIA to ensure that the rakyat receive the value of what they paid for.

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