Airfares may get cuts with lowered taxes

March 18, 2013 16:39
Airfares may get cuts with lowered taxes

Maharashtra will have better flying rates than the rest of the nation after the civil aviation minister hinted at a reduction of taxes on aviation turbine fuel.

Speaking on Sunday regarding the airfuel, in meetings with the CM of the state, Ajit Singh has brought up the concept of lowering taxes on aviation turbine fuel (ATF) in the upcoming state budget.

Presently ATF forms 25% of the total fuel price and is almost 40% of the price in an airline ticket. Regardless of any rebate, the passengers will definitely be burdened by this fuel rates. If there is significant reduction in these fares, the final prices will go down much lower than today's prices.

In everyday situations, flights often fly to cities where they can refuel for cheaper prices with lower taxes. With Maharashtra hinting that they may lower taxes, a significant share of the flights will fill in the refuelling stations and hence, the state will get more money into the exchequer. Benefits will be passed on to the fliers by their carriers too.

(AW- Anil)

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