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Air tax hike to hit ticket prices

Jul 07 2011 22:27 Sapa and Fin24

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Johannesburg - Airport tariffs will increase 34.8% in the 2010/11 financial year, which was "unavoidable but necessary", the Airports Company SA (Acsa) said on Thursday.

"Acsa recognises that the increase will have an impact on its customers, but reiterates that they are unavoidable but necessary for the industry," finance executive director Priscillah Mabelane said in a statement.

The new passenger service charge, effective from October 1, will be R96.49 for domestic, R199.12 for regional and R262.28 for international flights. These figures exclude value added tax.

According to the Acsa website, the current rates are R59.65(domestic), R124.56  (regional) and R164.04 (international).

The Civil Aviation Authority's regulating committee, which regulates Acsa and Air Traffic and Navigation Services, proposes the tariffs.

The transport department told reporters in Pretoria on Thursday that it would review Acsa's economic regulatory framework within the next six months, to create predictable, transparent and balanced tariff determinations in future.

Director-general George Mahlalela said his department, together with industry players, would address some of the gaps identified.

Welcoming the government's commitment, Mabelane said the intended regulations should offer an unambiguous policy framework, which was currently not the case.

"It should provide the market with confidence and foster sustainable growth. There has to be balance and I am confident that it will be found."

She said Acsa would participate in the process, adding that the promulgated tariff increase would enhance its financial position.

Regulating committee member Unathi Mntonintshi said tariffs would increase 37% in the next financial year.

"It will come down again in the third financial year," he said without giving details.

New funding models for airports would be put into place in future. However, this was not because there were any immediate plans of expansion, said Mntonintshi.

Meanwhile, Mahlalela said the department had R66bn to spend on improving transport infrastructure over the next year, increasing to R80bn in 2013/14. This was expected to help the tourism industry and create "numerous" jobs .
acsa  |  air travel
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