Govt may not give more sops to airlines

New Delhi: According to top officials in the ministry, the government is likely to deny any more benefits to airlines, if they do not pass the gain from lower jet fuel price to consumers, in terms of lower fares.
And, the ministry may have to face this question on Tuesday itself when it presents a case for giving more relief to the aviation sector before a PM-appointed panel.
"ATF (aviation turbine or jet fuel) prices have been lowered five times in past three months and they are now at September 2007 level. Airlines should now start passing on the benefit to passengers. Otherwise, why will the government keep giving sops if that ultimately do not reach the common man?" said highly placed sources.
There's now a growing feeling in the higher echelons of government that ATF price is now at a level where airlines should be able to swim through financially even if no further sops are given.
The ministry is pitching for further rationalisation of ATF prices by lowering taxes and duties as India has among the highest prices for this fuel. It's demanding the "declared good" status for ATF so that it attracts a uniform 4% sales tax across the country. Airlines maintain that massive rise in fuel prices from April to August led to huge losses.
18/11/08 Saurabh Sinha/Times of India

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Categories: Indian Aviation- In General Nov 2008