New Delhi: The ministry of civil aviation is to recommend that oil marketing companies be asked to share their infrastructure with airlines, to facilitate direct import by the latter of aviation turbine fuel (ATF).
Such direct import was formally allowed in February 2012 but the aviation companies lack the infrastructure to do so. A senior official at the ministry said, “We are looking at measures by means of which oil companies can share their infrastructure for transporting the fuel. This can be done at an agreed cost.”
Fuel costs are half the operational expenses of an airline in India. The value added tax on ATF ranges from four per cent to 30 per cent, depending on the sales tax levied by a state. If an airline can import fuel directly, it would only have to pay customs and countervailing duties, saving on state levies.
To address industry concerns over varied taxes at the state level, the civil aviation ministry is additionally looking at urging the government to levy a uniform tax on jet fuel. Taxes on ATF in India are among the highest in the world and are considered a major reason for the mounting losses of airlines.
Read news in full 09/06/14 Sharmistha Mukherjee/Business Standard
Such direct import was formally allowed in February 2012 but the aviation companies lack the infrastructure to do so. A senior official at the ministry said, “We are looking at measures by means of which oil companies can share their infrastructure for transporting the fuel. This can be done at an agreed cost.”
Fuel costs are half the operational expenses of an airline in India. The value added tax on ATF ranges from four per cent to 30 per cent, depending on the sales tax levied by a state. If an airline can import fuel directly, it would only have to pay customs and countervailing duties, saving on state levies.
To address industry concerns over varied taxes at the state level, the civil aviation ministry is additionally looking at urging the government to levy a uniform tax on jet fuel. Taxes on ATF in India are among the highest in the world and are considered a major reason for the mounting losses of airlines.
Read news in full 09/06/14 Sharmistha Mukherjee/Business Standard
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