Airlines want tax sops on lease rentals

New Delhi: In an effort to cut losses, the airline industry has asked the finance ministry for an extension of the exemption given on withholding tax on lease rentals of aircraft by another year. It has also called for harmonisation of domestic jet fuel prices vis-à-vis international rates.
Also, high on the industry’s wish-list for Budget 2007 is relaxation in fringe benefit tax (FBT) on free and concession passages given by airlines to its employees. The industry has put forth the argument that hotel stay of cabin and cockpit crew should not attract FBT as it is incurred as part of regular operational requirements and should not be treated as a perk to employees.
Airline sources said that another demand from the industry relates to acquisition of aircraft and purchase of simulators for training. Carriers have pitched for an exemption from withholding tax on interest payments on loans borrowed from various foreign financial institutions in this regard.
08/12/06 Sudipto Dey/Economic Times

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