VAT on aviation fuel down to 18 % in two of India’s top three airports

MUMBAI: In a major relief to airlines, the Maharashtra state government in its budget presented on Thursday announced a reduction in Value-Added tax (VAT) levied on Aviation Turbine Fuel (ATF) to 18 % from the current 25 % in Mumbai, Pune and Raigad. With this VAT on ATF has been brought down to 18 % in two of the top three airports of India.

Mumbai being the second busiest airport in India, the seven percent drop in VAT is expected to bring considerable savings for airlines. In Delhi though, the busiest airport in India, VAT on ATF continues to be high at 25 %. In December 2021, VAT on ATF charged in India’s third busiest airport, Bengaluru, was brought down to 18 % from 28%.