Fri, Apr 06, 2012 - Page 2 News List

CAA to review domestic flight carriers’ fuel levy

By Shelley Shan  /  Staff reporter

The Civil Aeronautics Administration (CAA) yesterday said it had not yet decided whether to allow domestic flight carriers to levy fuel surcharges.

At present, only international carriers are permitted to adjust the fuel surcharge according to fluctuations in international oil prices. They are allowed to do so when the oil price increases by US$10 per barrel.

CAA director-general Yin Chen-pong (尹承蓬) said the agency had not received any petition from domestic carriers regarding the issue, but had asked experts to evaluate the possibility of a rule change.

The result of the evaluation would be announced in August, he said.

Yin said the last time domestic carriers were allowed to raise airfares was in 2004, when aviation fuel cost an average of NT$13.6 per liter.

Currently, aviation fuel is NT$29.68 per liter.

“The report will -comprehensively evaluate the price-adjustment -mechanism,” Yin said.

Yin said costs of aviation fuel generally account for about 30 percent of a carrier’s overall operational expenditure.

China, Japan and South Korea have all allowed their domestic carriers to levy a fuel surcharge.

Officials added that the administration needs to take into account several factors before allowing domestic flight carriers to raise ticket prices, including government subsidies for residents of outlying islands.

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