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Gujarat Govt Reduces VAT On Aviation Fuel By 5%, Aims To Boost Tourism And Connectivity
In a bid to boost tourism and connectivity, the Gujarat government has announced. a reduction in value-added tax (VAT) on prices of aviation fuel. The decision taken by Gujarat Chief Minister Bhupendra Patel on Monday came in view of the directions given by the Union Aviation Ministry. Meanwhile, as per a statement by the Chief Minister’s Office (CMO), the price of Aviation Turbine Fuel (ATF) has been reduced by 5 per cent.
“The state government said that this people-oriented decision of Patel will boost the tourism activities in the state,” it added.
Notably, the price of aviation fuel plays a major role in the operating cost of airlines, and further the tax levied on ATF contributes significantly to its price. Also, other states and union territories (UTs) including Uttarakhand, Himachal Pradesh, Haryana, Madhya Pradesh, Jammu and Kashmir, Ladakh and Andaman and Nicobar have already reduced the cost of Aviation Turbine Fuel (ATF) by 4-1 per cent.
Aviation Ministry urges states and UTs to reduce VAT on aviation fuel
Earlier in August, Union Minister for Civil Aviation, Jyotiraditya Scindia in a written letter to 22 states and UTs had urged them to rationalize the value-added tax on ATF across all airports in their states within the range of 1 per cent to 4 per cent. He had also asked them to take the necessary decision in view of a common intention to boost air travel, connectivity, and further accelerate its economic development.“Addressing this issue would enable a force multiplier effect with regard to air connectivity”, he added.
Further citing examples of other states such as Kerala, Andhra Pradesh, Sikkim, Meghalaya, Nagaland, and Telangana, Scindia noted that they have already reduced the rates of aviation fuel followed by a substantial jump in the number of aircraft movements has also been recorded.
Meanwhile, the 22 states and Union territories to which the letters were written include Arunachal Pradesh, Assam, Bihar, Goa, Gujarat, Haryana, Himachal Pradesh, Jharkhand, Karnataka, Maharashtra, Madhya Pradesh, Mizoram, Rajasthan, Tamil Nadu, Tripura, Uttarakhand, Uttar Pradesh, Jammu and Kashmir, Delhi, Ladakh, the Andaman and Nicobar Islands, and Dadra and Nagar Haveli and Daman and Diu
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