Mumbai: A long pending proposal to notify Aviation Turbine Fuel (ATF) in the declared goods category, if taken up in the coming Union Budget, could further bring down airfares as well as helping loss making airlines improve their financial health.
The government has been thinking on these lines but has been facing resistance from state governments, who would lose sales tax revenue levied on ATF.
This levy is, on an average 28 per cent, causing a huge burden on airlines whose fuel cost accounts for nearly 50 per cent of their operating cost.
Though the government, in the last budget, allowed airlines to import ATF directly, it has remained a non-starter due to lack of appropriate infrastructure.
23/02/13 Lalatendu Mishra/The Hindu
