NE BUSINESS BUREAU
CHENNAI, FEB 5
The Centre has requested the Tamil Nadu government to reduce the value added tax (VAT) charged on aviation turbine fuel in line with the other states and to boost air connectivity, Union Minister of Civil Aviation Jyotiraditya M Scindia said on Saturday.
The Minister who was here on a brief visit to the state said the Ministry’s vision under Prime Minister Narendra Modi’s leadership was to increase the “width and depth of the airport penetration” in the country.
“We are making a request to the state government to reduce the VAT charged on the aviation turbine fuel to enhance greater penetration of air connectivity. Tamil Nadu is one of the few states which charges 29 per cent,” Scindia told reporters. Stressing that the VAT charged by the government was ‘very high’, he said one and half years ago 12 States in India charged VAT between one and four per cent, while 24 states charged VAT at 20-30 per cent on ATF. “With our continued dialogue, with our continued fervent appeal with folded hands, I would like to thank the chief minister of all those state governments, out of the 24, 16 state governments have moved from 20-30 per cent to 1-4 per cent VAT regime,” he said.
Currently, Scindia said 28 states in the country were charging VAT for ATF between one and four per cent while eight states were charging between 20 and 30 per cent. “If you lower the VAT, you will get greater connectivity, you will get greater economic multipliers because when you have greatest civil aviation connections, it leads to greater economic growth to that state,” he said.
“I do hope that they (Tamil Nadu government) will help me so that we can provide greater connectivity in TN”, he said.
Earlier in the day, the Minister inaugurated the multi-level car parking facility at the Chennai International airport which has been set up at an investment of Rs 250 crore by the Airport Authority of India that can facilitate 2,150 car parking and 4,000 motorcycles.
“This will lead to a new thrust with regard to connectivity,” he said.
