Hike in departure tax worries airline

By MARK HAIHUIE
AIR Niugini is concerned about the Government’s decision to increase the departure tax from K30 to K114.
Air Niugini board chairman Sir Frederick Reiher described it as “counterproductive” and the airline will make a submission to the Government to review that decision.
“I am bound to express my concern, and that of my board and management, at the recent Budget measure to raise the departure tax from K30 to K114,” Sir Frederick said.
“I genuinely believe this move would be counter-productive in every way. And we will be making a submission to Government seeking a review of this tax increase.”
He said the tax increase would adversely affect the tourism sector and a setback to the airline’s plan to make PNG the regional hub for flights.
“The tax hike would discourage the important development of Port Moresby as the major regional hub for the Pacific Island and into Asia and beyond that we are committed to delivering. Importantly, it would really undermine one of the Government’s key policy agendas that is the development of the nation’s tourist industry. The reality is that we operate in a highly competitive environment – especially when it comes to tourism and travel in the Pacific region.
“We must be competitive as well if we are to grow our tourism sector and the small business community that stands to benefit from it.”
Minister for Public Enterprise and State Investments William Duma said the Government would be receptive to the airline’s submission after receiving a dividend payment of K20 million from Air Niugini.