Dr M: Putrajaya to review airport tax rates, departure levy

Ida Nadirah Ibrahim
Transport Minister Anthony Loke, Prime Minister Tun Dr Mahathir Mohamad and AirAsia X chairman Tan Sri Rafidah Aziz visit AirAsia RedQ in Sepang August 16, 2019. — Picture by Miera Zulyana

SEPANG, Aug 16 — The federal government will study the rates of the passenger service charge (PSC), or airport tax, following AirAsia’s move to collect the additional RM23 levied by Malaysia Airports Holdings Bhd (MAHB) under protest, Tun Dr Mahathir Mohamad said today.

The prime minister said it would be unfair for an equal charge to be imposed for both normal and low-cost carriers as the two have different fares.

“Obviously, if you are charging low fare and you charge the passengers the same exit tax for high-cost and low-cost [airlines], it’s not fair. So we will look into the tax.

“We are studying the structure of our taxes so that we would be fair to everyone,” he told the media after an official visit to AirAsia’s RedQ headquarters here.

Dr Mahathir said an equal tax rate cannot be imposed on everyone, and therefore, Putrajaya will take into consideration all matters, including the size of airlines, fares and costs.

The airport tax was imposed by MAHB following a protracted court battle between the MAHB and AirAsia which was triggered after the latter refused to collect the RM73 PSC that the Malaysian Aviation Commission (Mavcom) had imposed on non-Asean flights at the KLIA2.

AirAsia Group Bhd co-founder and executive chairman Datuk Kamarudin Meranun had on August 3 said that the move had only affected the carrier’s position as a low-cost airline and its subsequent success in turning Kuala Lumpur as the low-cost aviation capital of the world for the last 18 years.

Meanwhile, when asked to comment on calls for the postponement of the departure levy, which will be effective on September 1, Dr Mahathir said the government will look into the matter.

Earlier this month, the government announced that Malaysians flying from the country will have to pay tax in the form of a departure levy ranging from RM8 to RM150.

In a ministerial order gazetted by the federal government on July 31, the departure levy rates would depend on the destination abroad and the class of the ticket.

Earlier during his visit at the AirAsia headquarters, Dr Mahathir says he hopes to see Malaysia becoming one of the world’s aerospace centres.

He said the expansion plan was due to the high demand in the aircraft industry and Malaysia’s role in supplying parts and components to aerospace companies such as Airbus and Boeing.

He, however, said there is no timeline for the proposed expansion but added that the government will “do it as quickly as possible.”

Also present during the visit was Transport Minister Anthony Loke, AirAsia Group CEO Tony Fernandes, and AirAsia X Bhd chairman Tan Sri Rafidah Aziz.

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