Kamis, 9 November 2023 – 12:00 WIB

Jakarta – The Indonesian Minister of Transportation, Budi Karya Sumadi said that the discourse on the elimination of the upper limit tariff (TBA) and lower limit tariff (TBB) isn’t possible, because these provisions are already in the law that regulates them. 

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“To eliminate The TBA and TBB is impossible because they are mandated by Law Number 1 of 2009 on Aviation,” the Minister said on Tuesday. 

This law provides the legal framework for the regulation of airline ticket prices in Indonesia. The TBA sets the upper limit for ticket prices, while the TBB sets the lower limit. 

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These limits are intended to ensure that air travel remains affordable for the public while allowing airlines to cover their costs and make a reasonable profit.

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“Rather than eliminating the TBA, I will review the amount in line with current conditions. This suggests that the government recognizes the need for flexibility in setting the upper limit tariff to accommodate changes in the aviation industry and the broader economy,” the Minister explained. 

“By conducting a detailed evaluation, the government aims to strike a balance between protecting the interests of airlines and ensuring affordability for the public,” Minister Sumadi continued. 

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Menhub Budi Karya Sumadi.

Previously, the Indonesia National Air Carriers Association (INACA) had proposed that flight fares be fully adjusted to market mechanisms. So, according to INACA, the upper limit tariff rule should be removed.

INACA considers that the determination of airplane ticket rates must be reviewed, to provide flexibility for airlines to adjust their rates. This is considered to provide sustainability for the airline business in Indonesia.

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Source : Dok. Kemenhub