Air travel will inevitably cost more on domestic and international flights as the government has increased the travel tax by up to 67% in the proposed budget for the 2023-24 fiscal year, raised for the first time after nine years.
An air passenger will have to pay a tax of 67% or Tk2,000 for travelling to Saarc countries, while Middle East-bound passengers have to pay 33% or Tk4,000 and 50% or Tk6,000 for other countries.
Meanwhile, domestic air passengers will have to pay a total of Tk925 as tax increases by Tk200 from the outgoing fiscal year.
In addition, passengers are to pay Tk1,000 for using land and sea routes for foreign destinations.
However, industry insiders and stakeholders fear that airliners, especially domestic ones, may lose passengers due to the rise in taxes. The issue may become a key factor in the rise in airfares.
Prominent aviation expert Kamrul Islam told Dhaka Tribune: “It will be a big blow to the Bangladesh aviation industry, and passengers will have to pay the ultimate price.”
The contribution of the aviation and tourism sector is about 3% of total GDP, but this sector has been neglected every year.
In the 2022–23 fiscal year, Tk7,004 crore was allocated in the proposed budget. Later, it was reduced to Tk5,628 crore in the revised budget.
This year, the government has proposed an allocation of Tk6,597 crore for the Ministry of Civil Aviation and Tourism.
Experts said if this allocation is lowered in the revised budget, passenger numbers will fall due to the existing dollar crisis and the high price of jet fuel.
According to the previous decision taken in 2014, data, passengers had to pay Tk500 to Tk1,200 and Tk4,000 as tax for North America, South America, Europe, Africa, Australia, New Zealand, China, Japan, Hong Kong, North Korea, South Korea, Vietnam, Laos, Cambodia and Taiwan, and Tk3,000 for rest of the international destinations.