The Union government is working on an aviation infrastructure policy to streamline investment into airports and other aviation-related infrastructure.
Ministry pushing for uniform sales tax on aviation turbine fuel
HYDERABAD: The Union government is working on an aviation infrastructure policy to streamline investment into airports and other aviation-related infrastructure.
The policy will provide a single-window facility for investors who have to seek multiple clearances from various agencies, Union minister for civil aviation Praful Patel said on Tuesday.
He was speaking to reporters after the test flights at the new Hyderabad international airport at Shamshabad. The new airport will be opened for commercial operations on March 16 by Congress president Sonia Gandhi.
“An investment between Rs 40,000-50,000 crore is expected over the next five years on new airports and there is a need for making this happen at a faster rate,” the minister told DNA Money.
“Infrastructure is one of the major constraints today, and the moment you give it, aviation will grow and sustain itself. The demand for aviation will keep growing over the years and supply will match demand only if infrastructure grows,” he added.
The civil aviation ministry was also pushing for declaring aviation turbine fuel (ATF) a declared good, paving the way for a uniform sales tax rate across states in the forthcoming union Budget, Patel said. Different charges by different states are not good for uniform growth, he added. ATF constitutes about 40% of the total operational costs for airlines, which pass on the burden to passengers.
Earlier, Andhra Pradesh chief minister Y S Rajasekhara Reddy announced that the state had decided to reduced the sales tax on ATF from the current 33% to just 4% in the state following a request by the union aviation ministry.
“There is a race between Bangalore and Hyderabad for attracting airlines and investments and we will do everything to make it happen here,” Reddy said.
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