Saturday, May 13, 2017

Centre cuts UDAN levy on air tickets

In a relief to passengers flying on major domestic routes, the Civil Aviation Ministry has decided to significantly reduce the levy on air tickets imposed to fund the Centre’s new regional connectivity scheme UDAN.

From June 1, it will only charge a uniform levy of Rs. 5,000 per flight on major routes, down from Rs. 7,500-Rs. 8,500 per flight it had ordered to charge earlier.

The move will come as a relief to passengers taking flights on major domestic routes as each passenger will have to bear about Rs. 30 as cess against about Rs. 50 as per government’s previous order in November 2016.

“The Central Government has decided to revise the levy on scheduled flights being operated within India to fund the Regional Air Connectivity Fund at a uniform rate of Rs. 5,000 per flight till further revision. The said levy will now come into effect from June 1, 2017,” said an order sent by the Civil Aviation Ministry to all Secretaries of Central government and chief secretaries of State governments on May 9.

The Directorate General of Civil Aviation (DGCA) has been directed to issue a circular on the revised levy amount.

The Centre had ordered imposing a levy of Rs. 7,500 for flights up to 1,000 km, Rs. 8,000 for flights between 1,000 and 1,500 km and Rs. 8,500 for flights beyond 1,500 km, except north-eastern states and regional routes, effective from December 1.

A reduction in levy is also seen as government’s efforts to bring domestic airlines on board its UDAN scheme as most domestic airlines refused to charge a levy on air tickets.

The Federation of Indian Airlines (FIA), which represents IndiGo, Jet Airways, SpiceJet and GoAir, had dragged the Centre to the courts challenging the levy to finance the regional connectivity scheme. Only AirAsia and Air India had imposed a regional connectivity scheme surcharge on its tickets so far.
13/05/17 Somesh Jha/The Hindu

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