Transport ministry plans airfare increase

The Ministry of Transport (MOT) on January 28 sent a dispatch to the Ministry of Finance, requesting to launch airfare guidelines for domestic flights.
The highest airfare (not including VAT and airport fee) proposed for the flights with a distance of 850 kilometres and higher is 1.81 million dong instead of the current level of 1.629 million dong
As such, if the proposal is approved by the Ministry of Finance, the economy class airfare to be applied for in Hanoi-HCM City flights after tax and fees would be two million dong, or higher by 200,000 dong per ticket in comparison with the current level of 1.81 million dong.
The airfare frame suggested by MOT includes three levels. The flights with a distance of less than 300 kilometers will have an airfare of 681,000 dong.
Meanwhile, passengers will be charged 863,000 dong for flights with a distance of 300-500 kilometers, 1.18 million dong for the flights with the distance of 500-less 850 kilometers and 1.818 million dong for the flights with a distance of 850 kilometers and higher
MOT proposes to apply the new airfare framework from March 1, 2010.
In fact, the Ministry of Finance in late October 2009 also sent a document to MOT, requesting the ministry to soon apply the policy to reveal the airfare for domestic air routes. The ministry emphasized that the circular on removing the ceiling airfare scheme took effect in 2008, but it has not been implemented in reality. In the first months of 2009, four enterprises sent dispatches to relevant ministries, asking to remove the airfare ceiling scheme.
Under the circular, launched on November 12, 2008, the airfare for flights on air routes where there is only one airline operating will be set by the State.
Meanwhile, as for other air routes developed by two or more airlines, enterprises will be able to set up airfares themselves, while the State sets no cap on the airfares. However, airlines will have to register airfares to government agencies every time they want to adjust the airfares.