Airlines Industry has been considered a fast growing sector within its parameters and has been a very promising area of adding value to the countries growth and the standard of its people. But the overall burden of the country seeks remuneration from all of its contributors and Airlines also in the queue.
Goods and Service tax implication are day by day increasing various industries round up taken towards the financial structure of their business operation and profit sensory ratio. In here, Airline industry has been giving far sight words on the taxation policy being ready for their area of work.
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The industry wants the GST to be fixed at 15% as it would help to sustain in a long run, otherwise, there would be a 9-15% increase in airfares if the GST is set higher than this limit. As said by an integral official, “Under no circumstance should GST exceed 15%, It would hamper growth in the fastest growing aviation market in the world.”
However, the current rate of service tax is 14% and adding Swachh Bharat Cess and Krishi Kalyan Cess, airlines pay 15% tax. In this further taxation dilemma, the airline’s official management met with finance ministers and aviation ministry officials to sort out the problems and financial crunch which GST can give to the industry.
Airlines industry has been facing a very miserable time as the burden is now very heavy with an equal amount of debt to be repaid. As if a good sign, the industry somehow managed some profits after the crash of fuel price. But the celebration won’t lasts forever as the GST is approaching with tax net in its hand.
An airlines officer disclosed that “This is based on the reason that duty has already been paid on ATF (aviation turbine fuel) and the same has not been allowed as the credit. Hence, levying GST on that portion of fare will result in double taxation”.
Also, there has been a convincing plea to continue the no service tax on payment of aircraft lease, import of aircraft, on aircraft parts and its repair and maintenance following.
