Indonesia permits airline fare increases of up to 13 percent

The government of Indonesia has authorized airlines to raise ticket fares by 9% to 13% as part of a broader strategy to manage the impact of rising fuel costs. Senior Economic Minister Airlangga Hartarto stated on Monday that the decision involves allowing a fuel surcharge hike of up to 38% of the upper airfare limit. To balance the fare increases, the administration is implementing several mitigation measures aimed at keeping travel costs within reach for the public. These measures include exemptions for value-added taxes on airlines and the waiver of import duties for aircraft spare parts. > The government has prepared mitigation measures so that ticket prices remain affordable to people, Airlangga said. Transport Minister Dudy Purwagandhi noted that domestic carriers had initially requested a fuel surcharge of 50%. However, the government settled on 38% as an ideal figure to maintain consumer purchasing power while helping airlines avoid significant financial losses amid the ongoing conflict in the Middle East. The new pricing policy will be in effect for an initial period of two months. Authorities will conduct further evaluations depending on geopolitical developments and their subsequent effect on the aviation industry.