Industry needs urgent attention
The Indian airline industry has renewed a call to include aviation turbine fuel in the Goods and Services Tax (GST), pointing out the urgent need to correct the high 35% tax.
“The inclusion of aviation turbine fuel in GST is a long-standing demand, every year we spend countless hours with various ministries of the government talking about this,” said Spicejet Ltd chairman and managing director Ajay Singh at the 12th International Conference-cum-Awards of Civil Aviation & Cargo held on 20 July 2019.
“If the ambition indeed is to be globally competitive, to create international hubs and carriers that are competitive in this world and if indeed the ambition is to be world leader in aviation, we need to resolve this problem quickly, there has been enough talks on this issue,” he voiced out the industry demand.
Singh also pointed out there have been enough talks about various problems being faced by the civil aviation sector and its time finally something was done about it.
“There is no country in the world which taxes aviation fuel like we do, we pay 35% tax on average on aviation fuel, this definitely needs to be addressed urgently.”
He further said that instead of those taxes coming down, now the government has imposed few more taxes.
“We have additional tax on import of spare parts that come back after repair, which is 5%, which the industry has been paying for last year and a half, about Rs.2,000 crore of industry money is struck under protest.”
“We also pay tax on tax in very many ways, in transport of fuel to our planes we pay tax twice over. As if it was not bad enough to pay the highest tax, we are also paying tax twice over,” said Singh.
He also pointed out that a country with 1.3 billion people needs to have its own international hubs.
“We indeed must be a true international global hub of the scale of Dubai or Singapore and we need to have a strategy to compete with them and we must work as a country to finalise, formalise a winning strategy which ensures that India is a global hub and a leading aviation country in this world.”
Lauding government’s handling of Jet Airways’ episode, Singh said, “We need to celebrate the fact that despite the failure of Jet Airways, the speed at which India recovered and got capacity back and got fares back to a normal level, is a great testament to the way India and government work together to make that happen.”
He, however, added, “At the same time, I think, this is a time for sombre reflection, the failure of Jet Airways and the condition of Air India, I think must give us pause.” fiinews.com