Airline authorities have expressed concern and disappointment over the recently announced proposed increases in Air Passenger Tax. Finance Minister, Pravin Gordhan, in his budget speech, announced a proposed 27% increase in government Air Passenger Tax on international flights from South Africa and a 25% increase for travel on flights from SA to SA Customs Union States. If the increases are implemented, international passengers departing SA would pay R190,50 and regional passengers R100. The increase comes as the airline sector not only buckles under the strain of increased ATNS charges and proposed Acsa tariff charges but also a soaring fuel bill as conflict in the Middle East fuels a steep rise in oil prices, breaching $114 a barrel for the first time in over two-and-a-half years. “The volatile state of the industry means that further cost increases are likely to be absorbed by many of the airlines themselves. We believe that the proposed tariff increases need to be reviewed urgently to ensure the sustainability of the airline industry in South Africa,” says CEO of Airlines Association of Southern Africa, Chris Zweigenthal. According to Board of Airlines Representatives South Africa CEO, Allan Moore, such an increase would “fly in the face” of efforts by the tourism ministry to encourage inbound tourism to South Africa. “The tax, imposed on all passengers flying across SA borders, is discriminatory in that it does not apply to domestic passengers and is almost double the amount paid by regional passengers. “It is a way of cross-subsidising domestic and regional travel at the expense of international passengers and creates yet another decision point for passengers deciding where to spend their discretionary vacation savings.” Moore says he hopes the funds derived from this tax will be channelled to airline or tourism-related expenditure and not become part of general revenue. Meanwhile, transport ministry Spokesperson Logan Maistry confirms that the department has yet to make an official announcement on the increased Acsa airport passenger service charge. A task team appointed by transport minister Sibusiso Ndebele last year to advise on a way forward regarding the impasse between Acsa and its Regulatory Committee recently delivered its final report. At the time, the minister insisted that the appointment of a task team in no way undermined the independence of the regulator. Rather, he said, it aimed to complement the work they had done. Acsa last year proposed a 133% tariff increase, which its Regulatory Committee declined, ruling instead that the airports authority be allowed to increase its tariffs by 40,7%. The minister, says Logan, will now “study the report as well as the recommendations and further pronouncements on this matter will be made in due course".