Jakarta. It costs more money to fly to other Indonesian cities from Jakarta compared to other ASEAN nations, and the freshly announced airfare hike caps are expected to create another turbulence on domestic tourism.

Indonesia has given its green light for carriers to raise the plane ticket prices by no more than 9% to 13% — effective immediately. The increases apply for domestic flights and come as a response to the energy shocks fueled by the protracted Iran war. The Indonesian Travel Agent Association (Astindo) fears that the 9-13% jump could “take a toll on domestic tourism”. Astindo deputy chair Sahlan M Saleh said that Indonesians had to spend more to fly within the country versus going to other Southeast Asian destinations. 

“Our outbound travel growth remains quite stable. The current geopolitics only reduces the bookings by 5-10%, but overall, it’s still pretty stable. … We [Indonesia] have become a market for Vietnam, Thailand, and Malaysia,” Sahlan said in a live-broadcasted interview with Beritasatu on Tuesday.

“It’s because the airfares to those [ASEAN] countries are cheaper than booking domestic flights. Our domestic airfares are not competitive.”

The latest hikes irritated Hanah, an Indonesian private sector employee who is fond of traveling. She admitted that this would only cause people to “think twice before booking domestic flights”, further making holidays at home not so attractive.

“It’s such a shame if our local destinations only attract a few visitors. Maybe the government should have considered the domino effect before deciding to raise the airfare,” Hanah told the Jakarta Globe.

“Value-wise, it is much more worth it to travel abroad. Can you imagine that we have to set aside a bigger budget to go to Banda Neira [in Central Maluku] compared to Thailand?”

Hanah — who refused to use her real name during the interview — has purchased a plane ticket for a Vietnam holiday. It cost her Rp 4.7 million ($275) for a round trip. She and her friend will spend 6 days there with pho and cafe hopping on top of their agenda.

The Prabowo Subianto government will temporarily bear the value-added tax (VAT) on domestic economy seats. Indonesia also signaled that the cap could even exceed 13% without such brakes in place.

The government has earmarked a total of Rp 2.6 trillion ($152.3 million) — split into Rp 1.3 trillion a month — to cover the VAT. Indonesia will implement the policy for two months and will review it later, depending on how long the US-Israel war against Iran continues to rage on. 

Senior minister Airlangga Hartarto chose not to worry about the impact of the hikes, citing that the second quarter had always been a low travel season. Local traveling enthusiasm is set to pick up once Indonesia enters Q3.

“The high season is in the third quarter because that’s when the school break is”, Airlangga said Monday.

Quick searches on the booking platform Traveloka have shown some gaps in ASEAN airfares. The cheapest flight from Jakarta to Kuala Lumpur is at around Rp 1.2 million per person. A Hanoi-bound trip costs at least Rp 3.4 million, while the plane ticket for Bangkok is lower at Rp 2.5 million. Jakartans have to set aside Rp 1.1 million for the cheapest Bali flight, and almost Rp 3.3 million to fly to Ambon's Pattimura Airport — the gateway for the aforementioned Banda Neira.

Indonesia registered around 193 million domestic tourist trips in the first two months of 2026.

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