The Gujarat government has announced a cut in value-added tax (VAT) on aviation fuel prices in an effort to enhance tourism and connectivity. Gujarat Chief Minister Bhupendra Patel made the decision on Monday in response to directives from the Union Aviation Ministry. Meanwhile, the price of Aviation Turbine Fuel (ATF) has been decreased by 5%, according to a statement from the Chief Minister's Office (CMO).
"The state government said that this people-oriented decision of Patel will enhance the tourism activities in the state," it added.
Notably, the cost of aviation fuel has a considerable influence in airline operational costs, and the tax levied on ATF also contributes significantly to its cost. Other states and union territories (UTs) have already lowered the cost of Aviation Turbine Fuel (ATF) by 4-1 percent, including Uttarakhand, Himachal Pradesh, Haryana, Madhya Pradesh, Jammu and Kashmir, Ladakh, and Andaman and Nicobar.
In a letter to 22 states and UTs earlier this month, Union Minister for Civil Aviation Jyotiraditya Scindia requested them to rationalise the value-added tax on ATF across all airports in their states within the range of 1% to 4%. He had also asked them to make the appropriate decisions in light of a shared desire to increase air travel, connectivity, and the country's economic growth.
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