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When taxes and charges weigh down the airfare

March 16, 2017 Headline News No Comments Email Email

An extreme example of the impact of fees and charges on airfares has been provided by a reader who is heading to Fiji in May, flying Fiji Airways, and who found that over 43% of the fare was made up of taxes and charges.

The booking is for a flight from Nadi to Sydney for one adult on Fiji Airways FJ 915 on 15 May 2017. Class: Bula Specials/Economy Restricted.

The taxes/surcharge breakdown is as follows:

Fiji Airport Departure Tax: FJD 200.00

Fiji Airport Development Charge: FJD 9.30

Fiji Airport Security Charge: FJD 9.30

Passenger Services Charge – Australia: FJD 47.10

Total taxes, fees and charges: FJD 265.70

The total taxes, fees and charges are equivalent to about AUD 167. Total cost of the booking was FJD 610.70 (about AUD 385), with taxes, fees and charges making up 43.5% of that.

“A rip-off” was how the reader described the tax side of the total, adding that it “keeps the locals at home I suppose”.

Fiji’s departure tax leapt in 2014 by 33% to FJD 200 (AUD 126) when Fiji Prime Minister Commodore Voreqe “Frank” Bainimarama introduced the tax increase in the country’s 2014 budget.

“The increased tax will include a FJD 10 environment levy for government’s obligations and commitment to a clean and sustainable natural world as provided for under the Constitution,” he said.

The departure tax, built into airline tickets, is one of the world’s highest, and perhaps the world’s very highest. Australia charges AUD 55.

Departure taxes, which go under a wide variety of names, are levied by countries ranging from Britain to Mexico, from Indonesia to Thailand, China, Egypt, Ecuador and a host more. Other taxes are levied by airports.

Some countries have got rid of their departure taxes. Ireland abolished its Irish Air Travel Tax (Cáin Aerthaistil) in the country’s 2014 Budget.

New Zealand currently levies no Customs charges for travellers departing that country, though departure taxes are imposed by some New Zealand airports and may be built into ticket prices.

“You should check for any charges with your travel agent,” the NZ Government advises.

It all boosts the cost of travel, which in turn acts as a deterrent to travel.

Not all fees relate to departure or airports. On the Australian domestic scene, people in Sydney heading to Victoria can spend almost three times as much to reach Sydney Airport than they spend on their airfares to Melbourne.

Australia’s Minister for Urban Infrastructure, Paul Fletcher, pointed out recently that airfares to Melbourne are on sale from AUD 69 but some customers travelling from Western Sydney “pay AUD 180 in taxi fares” to reach Sydney Airport.

Written by Peter Needham

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