New Delhi: Taking a dig at the Delhi government over its decision to levy higher tax on jet fuel, Union Minister Ashok Gajapathi Raju today said such a move would be like "taxing an economic activity to death".
ATF (Aviation Turbine Fuel) expenses make up a substantial part of the overall operational costs incurred by airlines.
To bring down the costs, the Centre had earlier written to state governments asking them to reduce the value-added tax on ATF.
Some state governments responded positively, while some did not, the Delhi government decided to enhance taxes on ATF, the Union Civil Aviation Minister said.
"Taxes are a reality, but taxing an economic activity to death, probably India shows the way in that... We need to come out of that scenario and go forward", Raju said here.
When asked about Raju's comments on Delhi government hiking tax on jet fuel, a Delhi government official said the decision was part of this year's Budget.
Even after hiking the VAT on ATF to 25 per cent from 20 per cent, the rate is still among the lowest, the official added.
On whether the Centre was looking to evolve a consensus among states with respect to taxation on ATF, the Minister replied in the negative.
20/11/15 PTI
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ATF (Aviation Turbine Fuel) expenses make up a substantial part of the overall operational costs incurred by airlines.
To bring down the costs, the Centre had earlier written to state governments asking them to reduce the value-added tax on ATF.
Some state governments responded positively, while some did not, the Delhi government decided to enhance taxes on ATF, the Union Civil Aviation Minister said.
"Taxes are a reality, but taxing an economic activity to death, probably India shows the way in that... We need to come out of that scenario and go forward", Raju said here.
When asked about Raju's comments on Delhi government hiking tax on jet fuel, a Delhi government official said the decision was part of this year's Budget.
Even after hiking the VAT on ATF to 25 per cent from 20 per cent, the rate is still among the lowest, the official added.
On whether the Centre was looking to evolve a consensus among states with respect to taxation on ATF, the Minister replied in the negative.
20/11/15 PTI
