Monday, September 06, 2021

Jewar airport seeks ATF taxbreak, DIAL parity

 New Delhi: The price of aviation turbine fuel (ATF), the largest cost for airlines, is set to play a crucial role in Noida International Airport Ltd (NIAL) attracting carriers. It has sought tax exemption on jet fuel from UP government.

“A final call on this request will be taken by the state cabinet,” Arun Vir Singh, CEO of Yamuna Expressway Industrial Development Authority (YEIDA) and NIAL told TOI.

Delhi government charges a steep 25% tax on jet fuel for domestic flights at IGIA, India’s busiest airport. “A kilolitre costs Rs 53,222.4 along with 25% tax (Rs 66,528) for domestic flights. In Lucknow, the same costs Rs 53,753.84 along with 21% tax (Rs 65,042.2). The average tax on domestic ATF in UP is 5%-20% at different airports. A tax rate of, say 1%, at NIAL could be a game-changer in terms of attracting airlines,” said a senior airline official.

It is learnt that the Delhi airport brass recently met top Delhi government functionaries to flag this issue. “DIAL sought a level playing field (in ATF pricing) and was told to wait and see what UP does. Delhi government has assured it will take the required steps,” said a source.

ATF accounts for over 40% of airlines’ total operating expenses. The cost for domestic ATF in India is among the highest globally. Lower jet fuel prices, through rationalised tax rates and base prices, would mean cheaper fares and more traffic for both airports and airlines.

07/09/21 Times of India

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