Ministry of Transportation to Review Proposal for 15% Increase in Upper Limit of Domestic Flight Ticket Prices
The Ministry of Transportation (Kemenhub) will review the request from the Indonesia National Air Carriers Association (INACA) regarding an increase in the upper limit tariff (TBA) for domestic flight tickets by up to 15 per cent.
Director General of Air Transportation at Kemenhub, Lukman F. Laisa, acknowledged the challenges facing the national aviation industry as a result of global geopolitical developments that have impacted the rise in aviation fuel (avtur) prices, exchange rate fluctuations, and increased operational costs for airlines.
“In relation to the request for adjustment of fuel surcharges and Upper Limit Tariffs (TBA) submitted by INACA, in principle, the Government is considering various aspects,” he stated in an official release on Wednesday (25/3).
He explained that the aspects under consideration include the economic condition of airlines, public purchasing power, the sustainability of the aviation industry, as well as safety, security, and service aspects.
The Directorate General of Air Transportation has been continuously coordinating with all stakeholders, including airlines, airport operators, avtur providers, and other related agencies, to monitor developments in avtur prices and their impact on flight operations.
Regarding the proposed stimulus policy, Laisa said the government remains attentive to fiscal conditions and the broader public interest. The government emphasised that every policy taken will prioritise a balance between the sustainability of the aviation industry and consumer protection.
“Thus, air transport services will remain maintained in terms of safety, security, affordability, and national connectivity,” he added.
Separately, INACA Secretary General Bayu Sutanto submitted a proposal for a 15 per cent increase in fuel surcharges on top of those already set through Ministry Regulation No. 7 of 2023 dated 10 January 2023. Additionally, INACA proposed a 15 per cent increase in the Upper Limit Tariff (TBA) for domestic flight ticket prices for both jet and propeller aircraft from the limits set through Ministry Regulation No. 106 of 2019.
In addition to adjustments to fuel surcharge and TBA amounts, INACA also proposed several temporary stimulus policies, such as for the 2026 Lebaran period. These proposals include deferral of VAT on avtur and domestic tickets, relief on airport fees or PJP4U, and rescheduling policies for outstanding payments of airport and navigation fees.
“This request is submitted by INACA to anticipate the avtur price adjustment from Pertamina effective 1 April 2026,” Bayu explained.
According to him, these steps are also intended to ensure business sustainability, safety assurance, and the availability of national air transport connectivity while maintaining high safety standards.
He added that the TBA increase proposal is based on the current aviation industry conditions affected by geopolitical conflicts between the US-Israel and Iran, which have created unfavourable international economic conditions. The impacts include rising global oil prices and the weakening of the rupiah against the US dollar, both of which significantly contribute to increased operational costs for national airlines.