Will air travel be cheaper? Airline companies’ big demand from the government – jet fuel comes under the ambit of GST

Air India, IndiGo and SpiceJet have demanded the government to bring jet fuel under the ambit of Goods and Services Tax i.e. GST. These airline companies say that this will reduce their operating expenses. At present, excise duty and value added tax (VAT) are imposed on jet fuel by the states. A major part of the operating expenses of any airline is on aircraft fuel. The Federation of Indian Airlines (FIA), representing Air India, IndiGo and SpiceJet, has said that the Indian aviation sector is facing many extraordinary challenges at this time. These include circumstances like increasing tension due to the ongoing conflict in West Asia, restrictions on airspace and weakening of the rupee.

it became difficult to manage

FIA said in a letter to the Civil Aviation Ministry last month that due to the current situation, the share of fuel in the operating cost has now increased from 30-40 percent to about 55-60 percent, making it economically difficult for Indian airlines to operate. According to this group, airlines are also facing a huge increase in other operating expenses. These include the increase in prices of polymers, petrochemicals, engineering materials, airport services, logistics and other fuel related goods and services.

It is very important to bring in GST

FIA said that considering the current situation in the world and the weak economic condition of the aviation sector, it is very important for Indian airlines to bring ATF under the ambit of GST with full ITC (input tax credit) benefits. The group has appealed to the Civil Aviation Ministry to take up the matter with concerned ministries and stakeholders and help in bringing ATF under the ambit of 5 percent GST and full ITC (input tax credit) as soon as possible.