A report is prepared by Deloitte Haskins & Sells for the Business Aircraft Operators Association (BAOA) has said that, as the indirect cost on rental service is increased from 15 percent to 18 percent, it will levy a higher burden of cost to the end customer.
The report was released on Wednesday at a seminar- BizAVIndia 2018 with the theme ‘Emerging opportunities for air connectivity in India: Navigating the future of business and general aviation’ organized by BAOA.
According to the report, the 5 percent GST on the import of aircraft for the purchase as well as for the rent will bring out the expansion in the working capital requirements. The report also stated that the GST law has not characterized different terms like “economy class” and “other than economy class”. While the economy class pulls up to 5 percent, the other than economy class draws 12 percent, which is the reason there is a need to provide a clear qualification to differentiate between the two cases under the GST rule.
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BAOA president Rohit Kapur said that the Indian government has finally given the green signal to the business industry and general aviation (BA/GA) industry. As now, the administration wants to accelerate its vision to enhance the air network and tourism in India.
Kapur said, “This priority focus holds tremendous promise for the BA/GA industry that includes helicopters, and will define the direction in which the industry will steer in times to come. The BA industry has undergone a sea change over the past decade in India and has gained much recognition in the recent years. The utility of Business Aviation, as a productivity tool and a contributor to economic development, is becoming more evident and should serve as the prime rationale to put in place an appropriate framework enabling industry’s growth and its role in channelizing economic and social benefits throughout India”.
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