Norfolk Island Airlines (Norfolk Island) will cancel its Auckland International flights as at January 14, 2018, the airline has announced. The route was only launched in June this year, but the carrier says that increased taxes have rendered the route unprofitable.

In June 2017, the Norfolk Island Regional Council (NIRC) approved its 2017-18 operational plan, which agreed to increase passenger embarkation & disembarkation fees from AUD23.10 (USD18.50) to AUD45.00 (USD36.00). The increased fee would produce a budget surplus of AUD1 million (USD800,000) to be put towards a runway upgrade.

"I cannot understand NIRC's and the Federal Government throwing prohibitive charges in that increase costs to an extent that it makes the run un-viable for Norfolk Island Airlines," the carrier said in a statement.

An extraordinary meeting held this week aimed to defer the fee increase until September 1, 2018. Two Councillors were concerned that the fee increase could deter visitors to the island, which relies heavily on tourism for its economy. However, the meeting was suspended pending legal advice and the matter will be discussed at the Ordinary Council Meeting on September 20, 2017.

"Coupled with larger than planned start-up losses caused by delays from the Norfolk Island Regional Council in relaunching the destination in New Zealand, the tax increases have resulted in the difficult decision that it is no longer a commercially viable option to continue further investment by the airline on this route," the carrier said.

Flights to Brisbane will still be operated as scheduled, despite a 10% increase in departure tax levied by the Australian government. Operations are onboard a B737-300 chartered from Nauru Airlines (ON, Nauru).

A direct Auckland - Norfolk Island flight was previously operated by Air New Zealand (NZ, Auckland International), which withdrew from the route in May 2017, citing low demand.