New Delhi, June
6:
The Ministry of
Petroleum and Natural Gas should bring aviation turbine fuel (ATF) under the
Petroleum and Natural Gas Regulatory Board's (PNGRB) regulatory scope by
notifying the product so that the Board can take action to protect the interest
of users, a Civil Aviation Ministry panel has said.
This is one of
the recommendations put forward by an expert committee set up by the Ministry
of Civil Aviation to bring down ATF cost for domestic airlines.
Currently ATF
costs comprise about 40-50 per cent of operations of domestic airlines.
The PNGRB
should also regulate all ATF infrastructure outside the airports including the
pipelines as well as connecting intermediate storage infrastructure.
The suggestion
has been made as due to lack of effective competition in the ATF market in the
country, the oil marketing public sector undertakings maintain ownership and
control access to the infrastructure, the committee has said.
Declared goods
The Committee
has also recommended bringing ATF under the ‘Declared goods' category so that
it attracts a uniform 4 per cent sales tax across the country. At the moment
the sales tax on ATF varies from 4 per cent to 30 per cent.
On an average
the sales tax rate on ATF is around 20 per cent which makes aviation fuel price
at Indian airports significantly higher than in Singapore, Hong Kong, Dubai,
London and Abu Dhabi.
Call for
specific duty
In addition the
Committee has suggested that States start charging a specific rate of duty on
ATF instead of the ad-valorem rate as is done at present.
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