Eastern Harbour Tunnel tolls will rise dramatically from May 1, sparking immediate government warnings of worsening traffic congestion. The increases, the second round for the New Hong Kong Tunnel company since 1998, average 66 per cent and will take effect on May 1. Tolls will rise by between $10 and $30 depending on the type of vehicle, with cars jumping $10 to $25. Taxis will get a grace period of one month and minibuses five months for arrangements to be made, such as a legal amendment to allow taxi drivers to charge more on their return ride. The company originally applied to increase the toll by $5 in 2002. But the Executive Council rejected the application, saying the company was in good financial standing and already making a profit. The company then took the case to two arbitrators, one picked by it and the other by the government. The arbitrators ruled in January that the company should be allowed a rate of return on investment of 15 to 17 per cent during its 30-year right to operate the tunnel. A company spokesman said it had made a return of 8.5 per cent up to 2003. After the toll increase, it would get an estimated 14.74 per cent return by 2016. 'Toll increases are a very small proportion from one person's expenditure,' he said. 'If people want companies like ours to build huge infrastructure projects in the future, they have to accept that we need to receive a reasonable return on capital. That's all we ask.' Transport bureau spokeswoman Joyce Yip Wai-ching said: 'Of course we are disappointed with the decision and very concerned about the toll increase's impact on traffic congestion.' The government predicted that the number of vehicles using the tunnel would drop by 17 per cent after the toll rise, pushing extra traffic onto the cross-harbour and western tunnels, she said. Lai Ming-hung, chairman of the Taxi and Public Light Bus Concern Group, said red minibus operators would be forced to pass on the increase to passengers. 'Minibuses operators are competing for passengers with the MTR. The increase will minimise our competitiveness to the train operators and this has a major effect on our business.' Mr Lai said taxi drivers would not suffer as much because they could use a different tunnel. Legco transport panel chairman Lau Kong-wah said: 'As the economy is yet to fully recover, a massive increase must cause a major burden to drivers. Those who use the Eastern Harbour Tunnel will opt for the Cross-Harbour Tunnel and this will create serious traffic jams in Kowloon.'