Transfer levy reduces Malaysia’s appeal as transit hub, says Matta
Published on: Thursday, March 21, 2024
By:
FMT, Ameer Fakhri
Matta worries that airlines may not be enthusiastic about using Malaysia as a transit hub because of a new passenger service charge for transfers.
PETALING JAYA: The Malaysian Association of Tour and Travel Agents (Matta) has urged the government to review the introduction of a passenger service charge (PSC) for transfers, saying it could diminish the country’s competitiveness as a transit hub.
Matta president Nigel Wong said that introducing a transfer fee would make Malaysia a less attractive transit destination for airlines.
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He said that given the country’s promotional activities, transit passengers could be converted into tourists, thus contributing to the local tourism sector.
“Tourism is not just about the tourism products in the country. It’s about overall passenger movement.
“As this charge also applies to transit passengers, that could affect the willingness of carriers to consider Malaysia as a transit hub.
“This, in turn, could lower the number of conversions from transit passengers to tourists,” Nigel told FMT.
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He said countries with better facilities such as Singapore, or those without transfer fees such as Thailand, would have a competitive advantage over Malaysia.
On March 12, FMT reported that the Malaysian Aviation Commission (Mavcom) would increase the PSC for international flights to Asean countries, effective June 1.
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Mavcom also introduced a PSC for passengers transiting through Malaysian airports.
Domestic passengers will be charged RM7 for transferring through a Malaysian airport, while international passengers will face charges of RM42 for transfers through KLIA Terminal 1 and RM29 for transfers through Terminal 2 or other airports.
Consortium of Inbound Tourism Alliance chairman Uzaidi Udanis said the PSC hike was necessary to improve the competitiveness of Malaysian airports.
Citing the KLIA aerotrain suspension as an example, he said the quality of Malaysia’s airports was lagging behind that of its rivals.
“The introduction of PSC won’t affect inbound tourism as the rate is not substantial relative to the total fare.
“However, the revenue from PSC should be reinvested in airport upgrades to improve the aviation industry and ensure the efficiency of airport operations,” he told FMT.
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