States oppose declared goods status for aviation fuel

New Delhi: The Empowered Committee of State Finance Ministers has opposed the idea of granting ‘Declared Goods’ status to aviation turbine fuel (ATF). It will be writing to the Prime Minister against the Centre unilaterally taking any such step, the Committee Chairman, Dr Asim Dasgupta, said on Tuesday.
Meanwhile, faced with the slackening growth in revenues due to the slowdown in the economy, the States are also planning to approach the Centre for an additional Rs 20,000-crore Plan grant to spend on infrastructure and social programmes, besides building houses in rural areas. The State Finance Ministers are likely to meet the Prime Minister for this, Dr Dasgupta told newspersons.
“Loss of revenue is one reason why States are opposed to ATF being given declared goods status. Anyway we are totally against any unilateral action from the Centre. The prices of ATF have recently come down, the benefit of which are not being passed on to passenger,” Dr Dasgupta said. States annually earn between Rs 3,500-4,000 crore from the taxes levied on ATF.
Besides, States are yet to receive any information about the cost structure of flight operations of various airlines and how ATF pricing is determined from the central Ministries concerned.
17/12/08 Business Line

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Categories: Indian Aviation- In General Dec 2008