Indore: Civil Aviation Minister Ajit Singh on Saturday said state taxes on aviation turbine fuel (ATF) should come down as high jet fuel prices are impacting fares of the airlines struggling with high costs and fierce competition.
"ATF costs have risen 8 to 9 per cent in March, and it will impact the air fares," Singh told reporters, after inaugurating the integrated airport terminal, built at the cost of Rs 135 crore.
Airlines would have to decide the fares based on commercial calculations, factoring in ATF costs, etc, he said.
The minister said taxes on ATF in some states have risen too steeply, up to 30 per cent, and they should come down, so that air connectivity to small towns increases.
"Let the reduction in tax start from Madhya Pradesh as the Chief Minister promised in his speech," Singh said, pointing to Shivraj Singh Chouhan, who was also present.
Airlines should woo passengers from tier 2 and 3 cities by increasing the connectivity, he added. The ministry would be spending Rs 67,000 crore for infrastructure development and low-cost airports in the 12th Five-Year Plan, Aviation Secretary Naseem Zaidi said.
As to the FDI in the aviation, the Union Minister said the final decision has to be taken by the cabinet.
15/04/12 Press Trust of India/IBN Live
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