Friday, June 16, 2017

Aviation ministry makes a U-turn, says it’s ready for July 1 GST rollout

New Delhi: Days after seeking deferment of GST rollout to September 1 on the grounds that airlines needed more time for the switchover, the aviation ministry on Thursday said it is ready for a July 1 rollout.
"Discussed preparedness with all aviation stakeholders; concerns were satisfactorily addressed. We are prepared for GST from July 1," minister of state for civil aviation Jayant Sinha tweeted on Thursday. The ministry is sending a letter to the revenue department to this effect.
Earlier this week, the ministry of civil aviation (MoCA) had asked the finance ministry to defer rollout of GST from July 1 to at least September 1 citing full service Indian carriers' inability to switch over to the new tax regime in a month.
MoCA had also sought some changes as GST, in its current form, may favour foreign carriers that offer a onestop service to distant places over Indian airlines that fly there direct.
"For instance, Air India flies nonstop from Delhi to several places in the US like New York, Chicago and San Francisco. Gulf carriers, on the other hand, take Indian travellers to their nearby hubs in places like Dubai, Abu Dhabi and Doha and from there fly them to North America or Europe.
So the GST on the AI ticket will be for the entire India-US route while on Gulf carriers it will only be for India-Dubai route and therefore much less. Due to this, more Indians will opt for Gulf or other airlines that fly to their hubs nearby, working to the detriment of Indian carriers," said an official.
16/06/17 Times of India