Service tax on air travel illegal: IATA

New Delhi: Global aviation body IATA today termed the service tax on air travel in India as "illegal" and said the "disconnect" between various ministries on aviation issues was "embarrassing" India in global fora.
Maintaining that there were differences between the Ministries of Finance and Civil Aviation on policy issues like FDI in aviation, the International Air Transport Association asked the government and related agencies to evolve a coordinated policy approach to prevent the interests of the sector from being compromised.
Citing the levying of service tax on air tickets by the government, IATA chief Giovanni Bisignani said Finance Ministry's move was "illegal" and embarrassing for India which was a leading member of the International Civil Aviation Organisation and a signatory to the Chicago convention.
Addressing a CII conference here, he said "the disconnect the Finance Ministry and the Civil Aviation Ministry has put India in an embarrassing position. It is not following the rules that it helped to create".
23/09/10 PTI/Economic Times

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Categories: Indian Aviation- In General Sep 2010