Aviation ministry writes to Finmin on rising ATF prices

NEW DELHI: Worried over the continued increase of Aviation Turbine Fuel (ATF) prices, the civil aviation ministry has now written a letter to the ministry of finance considering reduction on custom duty and excise duty.
The move is intended to provide relief to both airline and passengers over the increasing operating costs and ticket prices. “Though the custom and excise duty on ATF is less than the sales tax rate but when combined, they can still significantly make an impact. We’ve taken up the issue of reduction of customs duty and excise duty with the finance ministry and there has been a positive response,” said a ministry official.
Currently, the ATF price for domestic airlines include custom duty of 10% and excise duty of 8%, while different states levy a sales tax ranging between 20% and 30%. The price of ATF has more than doubled in the last three years. While in April 2007-08, the basic ATF rate was Rs 30,124.17/kl, currently it is at Rs 44,424.40/kl an increase of almost 47%.
10/05/08 Raja Awasthi & Dheeraj Tiwari/Economic Times

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Categories: Indian Aviation- In General May 2008