• Sector impact: GST and the aviation sector

    The goods and service tax (GST) once implemented will increase the cost of air tickets and other services such as cargo transportation and aircraft maintenance.
    The Indian aviation industry believes that the exclusion of petroleum and aviation fuel from its ambit will continue to impact the aviation sector.
    The central government will continue to impose excise duty on five petroleum products—crude oil, diesel, petrol, natural gas and aviation turbine fuel (ATF), while the state governments will continue to impose value-added tax on these petroleum products.
    ATF contributes over 40% of an airlines’ operating cost. Jet fuel prices in India are among the highest in the world. ATF prices for domestic carriers vary at different airports across the country due to different rates of sales tax and value-added tax. The various tax components before arriving at the final price include import duty on ATF.
    While petroleum and petroleum products are technically under GST, the GST council comprising of the Union and state finance ministers will decide upon their induction after the final GST regime is in place.
    Experts believe that the proposition shall be discussed. Jeff Heuerman Authentic Jersey

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