PH keen on AirAsia travel tax exemption proposal

The Philippines is closely looking into the proposal of AirAsia, a low-cost Malaysian airline, for the government to waive the travel tax for its planned expanded routes in low volume destinations in the country.

Trade and Industry Secretary Ramon M. Lopez reported that Malaysian side led by International Trade and Industry Minister Datuk Seri Mustapa Mohamed raised this request during their bilateral meeting during the just concluded five-day 49th ASEAN Economic Ministers Meeting and Related Meetings.

Lopez told his Malaysian counterpart that he will take this up with the Tourism Infrastructure and Enterprise Zone Authority (TIEZA) to study this request if it is worthwhile to waive travel tax in lieu of a prospective better revenues arising from improved tourism and economic activities in the destination city.

The Malaysian side explained that the waived travel tax (R1,600) may still be positive for the economy because of its multiplier effect. Currently, Air Asia has 30 routes across 20 airports in the Philippines and Asia.

Should the travel tax is waived airlines would be able to fly into missionary sites and more Filipinos can travel to these cities because of lower fares.

There will be redound into the development of tourism facilities in these areas because of improved economic activities.

Lopez noted of Air Asia’s flight to Bandung-Kota Kinabalu route where the waiving of travel taxes has paved the way for tourism growth and improved revenues. (BCM)