KUALA LUMPUR: Aviation industry players hope the government will consider a range of relief packages in the upcoming Budget 2022 to support air travel and tourism operator recovery.

As one of the hardest-hit industries during the Covid-19 pandemic, strong support from the government, such as tax exemptions, lower travel costs, and employment strategies, will be crucial for the whole ecosystem to rebound, according to Malaysia Aviation Group (MAG), AirAsia Group and Malaysia Airports Holdings Bhd (MAHB).

MAG hoped that Budget 2022 would include the exemption or delay in remittance of taxes, levies, or charges imposed by the government and regulatory authorities without interest or penalties until Dec 31, 2022.

“This will help to ease airlines’ cash flow,” the parent of national carrier Malaysia Airlines told Bernama. Airlines are imposed with the sales and services tax, Malaysia departure levy, regulatory service charge, and passenger service charge.

AirAsia Malaysia chief executive officer Riad Asmat expressed hope that Budget 2022 would include measures or incentives to reduce costs for travellers and businesses.

MAG hoped that the government would consider extending the time limit on unutilised tax losses beyond the current seven years given the lingering effect of the pandemic and relaxing group relief conditions.

With the tightening of group relief conditions, only newly incorporated companies are allowed to share their current-year losses to their related entities for up to three years, it said.“With the pandemic, there have been significant losses in the tourism industry and most businesses have pivoted their attention to areas that are more sustaining during the lockdowns in order to financially support the entire group.

“The relaxation of group relief conditions would be helpful in alleviating the burden on group companies that are still struggling to achieve profitability,” MAG said, adding that a temporary waiver on hotel tax and tourism-related taxes should also be considered to help restart and revitalise the domestic tourism industry.

Meanwhile, AirAsia Malaysia chief executive officer Riad Asmat expressed hope that Budget 2022 would include measures or incentives to reduce costs for travellers and businesses.

He said the government should also consider increasing the disposable income of Keluarga Malaysia to encourage domestic tourism and spending, attract more tourists and encourage higher spending by foreigners, while facilitating safe tourism.

“When it comes to employment, AirAsia hopes that priority will be given to help keep Malaysians employed and upskilled in the new digital era,” he said.

MAHB, the airport operator expressed hope that the Subang Airport regeneration plan would be implemented under Budget 2022, as the aviation ecosystem would likely generate more than RM10bil in economic output at maturity for the country.

Strengthening Subang Airport’s position as the preferred maintenance, repair, overhaul hub, aggregator of aerospace parts and components for final assembly and exports into the United States and Europe will also contribute 30% to 50% to the national revenue by 2030.

https://www.thestar.com.my/business/business-news/2021/10/08/aviation-players-wish-list-for-budget-2022