Indo plans tax hike for older planes
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Indonesia is considering increasing the tax rates for order planes operated by the country’s carriers, the Bali Post reported. Minister of Transportation, Jusman Syafi Djamal, said the move would act as an incentive for airlines to modernization their fleets.
Indonesia is trying to improve its aviation safety record, following a number of incidents involving the aging planes. Indonesian carriers have a poor safety record, which has continued into 2009. Within the space of three days in March, a Boeing 737-200 operated by Batavia Air cancelled a flight due to a leaking engine, and a Sriwijaya Air Boeing 737-200 was forced to make an emergency landing in Batam.
The Minister’s proposal has reportedly received the endorsement of the Chairman of the Indonesia Air Carriers Association (INACA), Emirsyah Satar, who also serves as the Chief Executive Officer of Garuda Indonesia. Adding that older airplanes are less fuel-efficient, Emirsyah argued that any aircraft maintained to a high standard is never “too old” to fly, but admitted the proposed tax hike was a valid way to encourage a younger national air fleet.
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