Thiruvananthapuram: In what could be a shot in the arm for Kannur International Airport Ltd (KIAL), which is set to begin operations in September, the state government is exploring the possibility of reducing the sales tax levied on aviation turbine fuel (ATF) from 28 per cent to 1 per cent.
A senior officer told ‘Express’ that KIAL has submitted a proposal to the state government seeking a tax sop on ATF as such a move will surely attract more domestic airlines to start services from Kannur airport. The carriers could also make Kannur their preferred fuelling point, he said. The government will take a decision soon. However, it is not clear whether the other three airports in the state will get the benefit of the proposed reduction on VAT charges.
According to a senior official, the reduction of VAT has been a long-pending demand of domestic airlines.
The Centre is charging a 14 per cent excise duty on ATF. On top of this, states charge up to 30 per cent sales tax or VAT. While Odisha and Chhattisgarh have slashed the VAT to 5 per cent in order to attract airlines, states such as Tamil Nadu, Karnataka and Maharashtra tax ATF at 29 per cent, 28 per cent and 25 per cent, respectively.
23/07/18 Dhinesh Kallungal/New Indian Express
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A senior officer told ‘Express’ that KIAL has submitted a proposal to the state government seeking a tax sop on ATF as such a move will surely attract more domestic airlines to start services from Kannur airport. The carriers could also make Kannur their preferred fuelling point, he said. The government will take a decision soon. However, it is not clear whether the other three airports in the state will get the benefit of the proposed reduction on VAT charges.
According to a senior official, the reduction of VAT has been a long-pending demand of domestic airlines.
The Centre is charging a 14 per cent excise duty on ATF. On top of this, states charge up to 30 per cent sales tax or VAT. While Odisha and Chhattisgarh have slashed the VAT to 5 per cent in order to attract airlines, states such as Tamil Nadu, Karnataka and Maharashtra tax ATF at 29 per cent, 28 per cent and 25 per cent, respectively.
23/07/18 Dhinesh Kallungal/New Indian Express
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