- IndiGo CEO Ronojoy Dutta requested the Ministry of Finance to reduce central excise taxes on fuel from 11 to 5 per cent, eliminate custom duties on aircraft repair parts and bring ATF under GST.
- Civil aviation pays 21 per cent of its revenues to the government in indirect taxes with very little input credit, he added.
- Indian carriers are likely to incur a massive loss of approximately Rs 20,000 crore in 2021-22 due to third wave of the COVID-19 pandemic and rising fuel prices: Crisil.
“Airlines pay 21% of their revenues to the government in indirect taxes with very little input credit. It is a very unreasonable proposition that an airline should earn a 21% margin just to pay taxes,” IndiGo CEO Ronojoy Dutta said on Wednesday.
“This unreasonable proposition is resulting in an industry that is chronically ill and is unable to live up to its true potential of boosting commerce and employment,” he said.
“ A rationalisation of taxes will result in explosive growth for aviation, which will have multiplier effects throughout the economy, stimulating commerce and employment and integrating the different regions of our diverse country closer together,” he added.
Civil aviation provides efficient infrastructure, critical for economic growth and employment in our country, yet civil aviation pays 21 per cent of its revenues to the government in indirect taxes with very little input credit,” Dutta said.
“Central excise taxes on fuel should be reduced from 11 per cent to 5 per cent, ATF (aviation turbine fuel) should be brought under the GST, custom duties on repair parts should be eliminated,” said Dutta, who is also the Whole Time Director of the airline. He requested the Ministry of Finance to take ‘immediate’ measures to address the ‘long festering problem’.
“ A rationalisation of taxes will result in explosive growth for aviation, which will have multiplier effects throughout the economy, stimulating commerce and employment and integrating the different regions of our diverse country closer together,” India’s largest airline’s CEO said.
On January 17, rating agency Crisil said in a report that Indian carriers are likely to incur a massive loss of approximately Rs 20,000 crore in 2021-22 due to third wave of the COVID-19 pandemic and rising fuel prices.