Transport Ministry: VAT exemption on flight tickets aims to protect public purchasing power

The Ministry of Transportation has stated that the policy of 100 percent government-borne value-added tax (PPN DTP) on domestic economy class flight tickets aims to maintain public purchasing power during the school holiday period. Director General of Civil Aviation at the Ministry of Transportation, Lukman F Laisa, said that through this policy, the VAT on the base fare and fuel surcharge for domestic economy class flights is fully covered by the government. “The implementation of the PPN DTP policy for economy class flight tickets during the school holiday period is running well as the government’s effort to maintain public purchasing power and support national mobility,” Lukman said when confirmed in Jakarta on Saturday. The facility applies to ticket purchases from the enactment of the regulation until 5 July 2026, for flight periods from 24 June to 5 July 2026. The policy is a follow-up to the Minister of Finance Regulation Number 43 of 2026 concerning Value-Added Tax on the Delivery of Scheduled Domestic Commercial Air Transport Services in Economy Class during the School Holiday Period Borne by the Government for the 2026 Fiscal Year. Lukman conveyed that the policy represents a form of government synergy in providing convenience for the public to travel during the school holiday period while maintaining purchasing power amidst the increased needs of the community during that period. The PPN DTP programme is one of the government’s measures to provide a stimulus to the public so they can travel by air at a lighter cost during the school holiday period. “Thus, the public has greater room to manage travel expenses and other needs,” said Lukman. Based on monitoring results by the Directorate General of Civil Aviation through the Air Transport Inspection System (ArTIS) application on sales data for 24 June 2026, the implementation of the PPN DTP policy has provided direct benefits to the public through ticket price adjustments on a number of domestic economy class flight routes. “Monitoring results also show that all airlines have implemented the policy in accordance with applicable regulations,” he said. The implementation of the programme is expected to support the smooth mobility of the public during the school holidays, strengthen inter-regional connectivity, and have a positive impact on the tourism sector and the national economy. The Directorate General of Civil Aviation continues to conduct regular monitoring and evaluation to ensure that the benefits of the policy can be felt optimally by the public and implemented in accordance with applicable regulations. “We urge the public to take advantage of this programme during the designated period. The government will continue to strive to maintain a balance between the affordability of air transport services, the sustainability of airline businesses, and aspects of aviation safety, security, and service,” Lukman stated. In addition to monitoring, the Directorate General of Civil Aviation is also carrying out intensive supervision of air transport business entities’ compliance in implementing the PPN DTP policy, the upper limit tariff, and the applicable fuel surcharge provisions. If violations of these provisions are found during implementation, the Ministry of Transportation will take law enforcement measures in accordance with laws and regulations, including imposing administrative sanctions on airlines that do not comply with the established provisions.