AIR
TRAVEL TO BE CHEAPER
The government's decision
to abolish taxes on air travel and reduce excise duty on aviation
turbine fuel (ATF) had its immediate impact on air travel
with all major airlines slashing their fares , taking them
below first class AC train fares.
The decision to reduce
excise duty on ATF from 16 to eight per cent and abolition
of Inland Air Travel Tax (IATT) as well as Foreign Travel
Tax (FTT) of Rs 500 per passenger was welcomed by the entire
aviation industry as also Civil Aviation Minister Rajiv Pratap
Rudy.
Officials of Indian Airlines,
Jet Airways and Air Sahara said the abolition of IATT would
immediately be implemented and the passengers would get the
benefit. The IATT constitutes 15 per cent of the fares. Spokespersons
of IA and Jet Airways said the apex fares would also be reduced
with the abolition of the IATT, taking them below the first
class air-conditioned fares.
The fares are likely to
come down further when the benefits of reduction in excise
duty on ATF from 16 to eight per cent is passed on to the
consumers. Generally, the ATF component constitutes almost
35 per cent of the operating cost.
Officials of Indian Airlines
and Air Sahara also announced abolition of IATT and the resultant
cuts in the regular and apex fares. While the Delhi-Mumbai
apex fare for 30 days would be Rs 3,154 compared with a first-class
train fare of Rs 4,135, Mumbai-Kolkata 30-day apex fare would
be Rs 3,589 compared with first class train fare of Rs 4,135,
a Jet Airways spokesman said, adding the IATT component of
regular fares would also be removed.
Similarly, Delhi-Chennai
fare would be Rs 3,502 compared with first class train fare
of Rs 4,301 and Delhi-Bangalore Rs 4,372 compared with Rs
5,730 by train.
Welcoming the move, industry
sources said it had been their long-standing demand that all
taxes on ATF be abolished and its levels be brought down to
at least four per cent as had been done by Andhra Pradesh.
Amadeus managing director A Bhatia said the cut in IATT and
ATF would lead to a 15 to 20 per cent drop in air fares.
