New Delhi: Industry body Assocham on Friday
suggested that the government should confer core industry
status to the airlines business to sustain the aviation
sector.
"The sustainability of airline industry would be severely
eroded if it is not recognised as 'core industry'," Assocham
said in a statement.
The chamber also sought 'declared goods' status to
aviation turbine fuel (ATF) by lowering sales tax and revising
its taxation structure.
"It is revealed that ATF prices for 11 international
airports as on July, 2009, ranged between Rs 23,000 and Rs
26,000 per kilo litre. While Kuala Lumpur has the lowest price
of Rs 22,800 per kilo litre, India's airports, the into-plane
ATF prices ranged between Rs 34,000 and Rs 47,000 per kilo
litre," Assocham President Swati Piramal said.
Assocham pointed out that the lowest price of ATF among
Indian airports is at Hyderabad, which is 46 per cent higher
than the price at Kuala Lumpur, while the highest price is at
Kolkata with almost double than that of at Kuala Lumpur.
"While state taxes contribute significantly to the high
into-wing ATF prices in India, it is a fact that if state
taxes were fully eliminated, Indian ATF prices would still be
significantly higher than those outside India," it said.
Besides, Assocham advocated re-instatement of exemption
from withholding tax on aircraft lease rental payments and
issuing of show cause-cum-demand notices on some airlines for
alleged violations of service tax rules under various taxable
services. It also suggested lower service taxes.
PTI
First Published: Friday, December 25, 2009, 18:28