Govt to collect hundreds of million annually from departure levy

SEPANG: The government is expected to gain a few hundreds millions ringgit annually from departure levy collection for all outbound travellers, said Transport Minister Loke Siew Fook.

However, Loke said the government has yet to finalise whether the impending departure levy will be added in the passenger service charge (PSC) or customs/immigration.

The ministry would announce the tax mechanism soon following the government’s decision to introduce the departure levy on June 1, 2019.

“We need to increase the government’s revenue. The departure levy will be a source of revenue for the government,” he said on the sidelines of the launching of Ground Team Red’s Malaysia’s first digital airport control centre, here, today.

Loke said the departure levy was not new in other countries such as in Thailand and Japan but the implementation would be new in Malaysia.

“Currently, the passenger service charge (PSC) is paid to Malaysia Airports Holdings Bhd (MAHB) as the airport operator, to run airports’ operation,” he said adding that the government does not collect the PSC.

He said the government has had an operating agreement with MAHB where certain portions of the revenue will be paid to the government every year.

Currently, MAHB pays about 11.8 per cent user-fee between RM300 million and RM400 million to the government annually.

The PSC charges currently is at RM35 and RM73 for outbound travellers to Asean and other international destinations respectively.

During the Budget 2019 presentation recently, Finance Minister Lim Guan Eng said the government would propose a departure levy for all outbound travellers beginning June 1, 2019.

The rate is applied to every international departure from Malaysia at a rate of RM20 to Asean countries and RM40 to other international destinations.

It is understood that the levy allow the government to widen its revenue base and enjoy surplus with the potential to upgrade/expand and improve the full capacity airports.

Asked whether AirAsia willing to partially absorb the departure levy, AirAsia Group chief executive officer Tan Sri Tony Fernandes said: “Let’s wait and see the mechanism (tax) and a few other things. Obviously, there are lot of things that we have to talk about.”

Source: NST