Air fares may go down in Maharashtra

Monday, 18 March 2013 - 9:00am IST | Place: Mumbai | Agency: DNA
Pin your hopes on a drop in air fares in the state. For, civil aviation minister Ajit Singh has hinted at it.

Pin your hopes on a drop in air fares in the state. For, civil aviation minister Ajit Singh has hinted at it.

On Sunday, Singh said he had held several rounds of meetings with chief minister Prithviraj Chavan on lowering taxes on aviation turbine fuel (ATF) in the upcoming state budget.

The tax on ATF in the state — 25% — is among the highest in the country and makes up over 40% of airlines’ costs, which passengers have to inevitably shoulder. Delhi, on the other hand, has a sales tax slab of 20% on ATF.

What the math translates to is that airlines prefer to refuel at states which levy lower taxes. So, if Maharashtra decides to lower the tax, more of them are likely to refuel here. More the number of airlines queuing up to tank up, richer turn the state’s coffers. The benefit may be passed on to fliers.

“We can expect a decision on this in the state budget,” said Singh, who was in Mumbai to attend the 11th Routes Asia Conference.

@abidi_shahkar


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