An airlines industry body has sought reduction in customs and excise duties on aviation turbine fuel and allowing private firms to supply it to bring down prices.
The Federation of Indian Airlines has said in a paper that high sales taxes imposed by state governments made the jet fuel prices, which account for almost 40 per cent of an airline's annual expenditure, prohibitive.
Comparing ATF prices with those at major Southeast Asian and Gulf airports, the Federation said ATF prices in India were 73 per cent higher than in Southeast Asian countries and Gulf countries.
The ATF price per kilolitre in Singapore in March this year were Rs 20,779 per kilolitre while in India the prices were above Rs 30,000 in major cities, it said, adding that customs duty of 10 per cent and excise duty of 8.24
Public sector oil firms had on May 1 raised jet fuel prices by 3.5 per cent.
The prices of ATF in Delhi were raised from Rs 36,149.04 per kilolitre to Rs 37,421.94 while in Mumbai the prices went up by Rs 1,325.94 per kl to Rs 38,690.39 per kl.
Bolstering the industry's demand, a Parliamentary Committee has also asked government to notify jet fuel as a 'declared good' to bring down sales tax.
In a report tabled in Parliament, the Standing Committee on Transport, Tourism and Culture has asked finance ministry to 'sympathetically consider' the civil aviation ministry's proposal to notify ATF as 'declared good' on a priority basis to all aircraft in order to contain sales tax at a maximum rate of four per cent.
