Civil Aviation Ministry Contemplates Cutting Taxes On Jet Fuel
In this context the union government is exploring various options to minimise the impact of the West Asia conflict on airlines. The Value Added Tax (VAT) on Aviation Turbine Fuel (ATF) vary from state to state which ranges between 25 per cent in Delhi to 1 per cent in Uttar Pradesh
New Delhi: In a bid to minimise the impact of the West Asia conflict on the Indian airlines, the Union Civil Aviation Ministry is engaging with state governments to cut taxes on jet fuel. The step comes at a time when several countries have started canceling flights as jet fuel prices surged phenomenally sending shockwaves through the aviation sector worldwide.
While jet fuel rates in India are yet to shoot up, it is learnt that airlines have approached the government seeking relief on taxes and airport charges to manage the rising costs. Jet fuel accounts for around 40 per cent of an airline's total operational costs.
In this context the union government is exploring various options to minimise the impact of the West Asia conflict on airlines. The Value Added Tax (VAT) on Aviation Turbine Fuel (ATF) vary from state to state which ranges between 25 per cent in Delhi to 1 per cent in Uttar Pradesh.
Already several carriers have curtailed their scheduled services, especially to the region, and the airspace restrictions are forcing them to take longer routes for European and North American destinations, resulting in increased fuel burn.
The Indian government has already cut the excise duty on petrol and diesel and additional excise duty on export of diesel and ATF has been hiked to prioritise their domestic availability. It is learnt the Director General of Civil Aviation is in touch with its counterparts in other countries on the evolving situation in West Asia.
Meanwhile. the airlines will be operating a lesser number of flights in the current summer schedule as the civil aviation authorities decided to be 'little more moderate" in approving the number of services in the backdrop of IndiGo's massive operational disruptions last December. The ministry and DGCA do not want a situation similar to what happened at IndiGo in December last year.
The summer schedules of the airline have been approved after taking into consideration the availability of aircraft, pilots and other aspects. In the domestic summer schedule, airlines are set to operate at least 10 per cent less flights compared to the number flights flown during the same period a year ago.
