NEW DELHI: Flyers should brace for a fare hike. The civil aviation ministry is likely to propose a 1 per cent cess on fares to fund air connectivity in non-lucrative regional routes.
"The government's focus is to improve regional connectivity in the country and a collection from 1 per cent cess on tickets will be utilised in funding the losses of operators on loss-making smaller routes," said a civil aviation ministry official who did not want to be identified. The ministry will discuss the proposal on Thursday.
Another source said the government has in-principle accepted the proposal of the cess on fares (excluding taxes) and it will form part of the new draft civil aviation policy.
Assuming India's 60 million domestic passengers pay an estimated average fare of Rs 4,000 per ticket, a 1 per cent cess would generate about Rs 240 crore for the government.
16/07/15 Mihir Mishra/The Economic Times
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"The government's focus is to improve regional connectivity in the country and a collection from 1 per cent cess on tickets will be utilised in funding the losses of operators on loss-making smaller routes," said a civil aviation ministry official who did not want to be identified. The ministry will discuss the proposal on Thursday.
Another source said the government has in-principle accepted the proposal of the cess on fares (excluding taxes) and it will form part of the new draft civil aviation policy.
Assuming India's 60 million domestic passengers pay an estimated average fare of Rs 4,000 per ticket, a 1 per cent cess would generate about Rs 240 crore for the government.
16/07/15 Mihir Mishra/The Economic Times
