Chandigarh: Presenting the 2011-12 budget in the Lok Sabha, the union finance minister also proposed to tax the travel by higher classes on the domestic sector at the standard rate of 10%.
With this, the tax on economy class domestic travel would stand at Rs 150 instead of the current Rs 100 and Rs 750, as against Rs 500, for international travel.
Domestic travel on business or high class would attract a flat service tax of 10% of the fare. This would bring domestic air travel at par with international journeys by the same classes.
The hike in service tax on air travel would be effective from April 1.
At present, there are 11 flights operating from the Chandigarh airport to various domestic destinations. Prominent among those are Delhi, Mumbai, Banglore, and Srinagar. Jet Airways, Kingfisher Airlines, Air India and Indigo fly from the local airport. But with the proposal, only the business class will have to shell out more money than those travelling in the economy class. With the proposed hike, passengers travelling from Chandigarh to New Delhi in business class will have to pay around Rs 7,700 (approximately) instead of the present fare of around Rs 7,000.
Similarly, travelling in business class from Chandigarh to Mumbai will cost around Rs 20,500 instead of the present rate of around Rs 18,000.
01/03/11 Times of India
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