Aviation secretaries to take stock of sops

After handing out a slew of incentives to the aviation industry over the past fortnight, a committee of secretaries, led by Cabinet secretary KM Chandra- sekhar, is scheduled to meet on Monday to assess the impact of these measures on the sector and the need for additional measures.
Income tax benefits to the aviation industry and reduction of sales tax on aviation turbine fuel were some of the additional proposals discussed by the CoS in its meeting in August. Other proposals, such as preparing a package for financial relief to airlines over the next two years, reducing customs duty on ATF and asking airlines to import the fuel at least to Mumbai and Chennai, were also discussed.
These could be looked into once again, if it is felt that the aviation sector needs more help, a source said.
CoS had earlier sought the revenue department’s views on allowing private airlines to carry forward accum-ulated losses and unabsorbed depre-ciation upon being merged, for a limited period. With most private carriers making losses, setting off accumulated losses and unabsorbed depreciation for eight years will encourage consolid-ation in the industry.
The issue was also taken up at the time of this year's Budget, but the finance ministry did not go ahead with it.
Such a provision had been added to section 72 A of the Income Tax Act for public sector aviation companies and had helped ease the merger of Air India and Indian Airlines. Since then private airlines too have been seeking the benefit.
03/11/08 Surabhi/Financial Express

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Categories: Indian Aviation- In General Nov 2008