NEW DELHI: The special additional excise duty (SAED) of Rs 6 per litre slapped on jet fuel exports to protect domestic availability has boomeranged on Indian airlines and put their overseas operations at a cost-disadvantage against foreign carriers.
Industry sources said some of the oil companies have taken the view that Friday’s export tax notification has upended the exemption from 11% basic excise duty (BED) on jet fuel purchased by domestic carriers for their overseas flights as the part of the fuel will be consumed before entering international airspace.
This has led to Indian carriers being burdened with SAED and BED, jacking up the cost of their overseas operations, whereas foreign airlines remain exempted from both taxes under the Foreign Aircraft (Exemption from Taxes and Duties on Fuel and Lubricants) Act, 2002.
