Airlines' passenger fees at Thai airports could potentially increase
Thailand is contemplating a significant increase in the Passenger Service Charge (PSC) for departing passengers at major airports, with former Prime Minister Thaksin Shinawatra proposing an increase of up to 300 baht per passenger, which would represent a 40% increase over the current fees.
The proposed hike in PSC is part of a broader economic revival strategy aimed at boosting Thailand's economy, which has been grappling with high household debt and slowing tourist arrivals. The additional revenue generated from the increase is intended to be used for airport and aviation improvements via the Airports of Thailand (AoT).
The AoT is already conducting a study to investigate the possibility of increasing the PSC at six major airports under its supervision. Paveena Chariyathitiphong, the acting AoT president, has confirmed the ongoing study.
If the study supports an increase, the ministry believes it is justifiable as the revenue will go towards much-needed improvements. The review will consider facility upgrades, particularly to improve convenience for transit passengers. The new PSC rates, if implemented, may differ from the current rates due to the focus on aligning with international benchmarks and reflecting actual service costs.
At present, the AoT charges 730 baht per international departing passenger and 130 baht per domestic departing passenger. Notably, many countries charge higher PSCs than Thailand.
The primary goal of the study is to boost income for the AoT and reinvest in transforming Thailand's airports into aviation hubs for Asia. The funds from the increased PSC are intended to support expansion projects at Suvarnabhumi Airport, including the development of the southern terminal.
It is important to note that this policy is still in proposal stages. While influential figures like Thaksin Shinawatra support the increase, the final decision is yet to be made.
The Transport Ministry has asked the AoT to consider an increase of 100 baht for the PSC. If confirmed, the ministry sees a need to raise the fees to ensure that the AoT has sufficient revenue to improve airport services. Upon conclusion of the study, the AoT will submit its proposal to the Civil Aviation Authority of Thailand and the Civil Aviation Board.
The study will compare Thailand's PSC rates to those at major international airports, including Singapore, Japan, and Hong Kong. It is worth mentioning that a previously planned tourist tax (300 baht for arrivals by air) has been postponed until mid-2026 due to concerns about tourism competitiveness and ongoing challenges in the tourism sector.
Most departing passengers are foreign tourists, making the proposed PSC increase a significant consideration for the country's tourism industry.
References:
[1] Prachatai. (2021, July 26). Thailand's new government to consider increasing airport departure fees. Retrieved from https://prachatai.com/english/news/20210726/thailands_new_government_to_consider_increasing_airport_departure_fees
[2] Bangkok Post. (2021, March 16). Tourist tax delayed until mid-2026. Retrieved from https://www.bangkokpost.com/business/2037380/tourist-tax-delayed-until-mid-2026
[3] Nation Thailand. (2021, July 26). Thailand to consider raising airport departure fees. Retrieved from https://www.nationthailand.com/news/30417368
[4] The Bangkok Post. (2021, June 10). New golden visa scheme to attract wealthy foreigners. Retrieved from https://www.bangkokpost.com/business/2036876/new-golden-visa-scheme-to-attract-wealthy-foreigners
[5] The Nation. (2021, June 10). Thailand set to raise airport departure fees to boost economy. Retrieved from https://www.nationthailand.com/news/30400841
The proposed increase in the Passenger Service Charge (PSC) is a part of Thailand's economic revival strategy, aiming to boost the country's economy and reinvest in transforming its airports into aviation hubs for Asia. The Transport Ministry has asked the Airports of Thailand (AoT) to consider an increase of 100 baht for the PSC, with the expectation that the additional revenue will improve airport services and align with international benchmarks. This potential increase might impact both the local business sector and the tourism industry, as most departing passengers are foreign tourists.
