This is bad news for anyone planning a trip overseas, starting on July 1, all airlines will be significantly raising the federal excise charge (FED) on tickets for foreign flights. This rise is in response to the recent budget statement made by the federal government.
All of the big airlines, including Saudi Air, Emirates, and Pakistan International Airlines (PIA), have started charging the increased tariffs. Under the modification, the FED for economy and economy plus tickets will climb by 150%. Consequently, travelers will now need to pay Rs12,500 in FED instead of the previous Rs5,000 for economy tickets.
The effect on passengers flying in first class is equally significant. Club Class tickets to the USA now have a hefty FED of Rs350,000 instead of Rs250,000. Likewise, taxes on airline tickets to Africa and travel to the Middle East now costs Rs. 105,000 instead of Rs. 75,000.
The FED has increased to Rs210,000 for flights to places in Europe from Rs 150,000. There would be a 40% increase in duty for travelers going to Australia, New Zealand, and Far Eastern nations, with the total cost coming to Rs 210,000.
It is anticipated that this increase in FED will significantly affect travel expenditures and may discourage many people from taking foreign flights. Airlines quickly changed the cost of their tickets to reflect the additional charges, which will have an impact on travelers purchasing tickets after July 1.
Experts in the travel industry predict that this significant rise in FED may result in a drop in demand for overseas travel, especially from budget-conscious tourists. The surge is especially difficult for airlines and travelers because it occurs while the travel sector is still getting over the COVID-19 pandemic’s consequences.
The government’s move to raise the FED is a component of larger revenue-boosting fiscal initiatives. It is unclear, meanwhile, how this action would impact general travel trends and the airline industry’s recovery in the upcoming months.
