Israel Airport Departure Fees Rise 11% in Dollar Terms

Aviation authorities in Israel have announced an 11% increase in departure fees for passengers flying out of Ben Gurion Airport, effective in 2027. The fee for passengers departing from Terminal 3 will rise to $37.68 from $33.87, while the fee for Terminal 1, primarily used by low-cost carriers, will increase to $17.36 from $15.61. While this appears to be a significant jump, the actual increase in shekel terms is minimal, reflecting only a 1.54% rise in the consumer price index. The larger dollar figure is primarily due to the weakening of the Israeli shekel against the U.S. dollar. The departure fees are set in shekels and adjusted annually based on inflation and the exchange rate. The Authority for Airports and Aviation emphasizes that the shekel-based increase aligns with inflation, and the dollar-denominated fee fluctuates based on currency exchange rates. Airlines are responsible for paying these fees, which are typically passed on to passengers as part of taxes and surcharges. The extent to which passengers will bear this cost depends on the airline, the route, and market competition. In highly competitive markets, airlines may absorb some of the increase, while on less competitive routes or during peak seasons, the cost is more likely to be passed on. For an airline handling 2 million passengers annually from Terminal 3, the fee increase translates to an additional $7.6 million in 2027. For Israeli airlines selling tickets primarily in shekels, the actual impact is closer to the 1.5% inflation adjustment. Foreign airlines pricing in dollars or euros may see a more direct increase, potentially affecting ticket prices for flights to Israel. However, the additional cost per ticket is expected to be a few dollars, a relatively small amount compared to the overall price of a flight. This fee adjustment occurs amidst record passenger traffic at Ben Gurion Airport, which can give airlines more leverage to pass on costs. The Authority for Airports and Aviation relies on these fees as its primary revenue source, funding airport operations, security, and infrastructure investments. Future adjustments in 2028 will similarly depend on inflation and the dollar-shekel exchange rate.