Delhi govt considering proposal to cut value-added tax on aviation turbine fuel
The Delhi government is considering proposals to revise the tax and cess rates on petrol, diesel, aviation turbine fuel (ATF), and natural gas, multiple officials told Moneycontrol.
"Proposals to reduce value-added tax (VAT) on petrol, diesel and ATF are being considered with a decision likely to be made by the end of April," a senior official from the Delhi government said.
He added that the Delhi government is also looking at ways to manage its revenue collections from Goods and Services Tax (GST) and VAT and reduce tax rates. The Delhi government's revenue collections for 2024-25 were below the budget projections.
ATF tax likely to be cut to 10% from 25%
"In order to make sure revenue collections do not take a big hit, the government is working with the central government to ensure the correct formula to reduce tax rates and manage revenue for 2025-26," another senior government official said.
Fuel make up nearly 40-45 percent of the operating costs for an Indian carrier. Indira Gandhi International Airport (IGIA) in Delhi is India's busiest airport, handling over 73.6 million passengers in FY24, including 19 million international travellers - a 24 percent increase from the previous year.
He added that, as part of the proposals being considered by the Delhi government, the state might cut VAT on ATF to 10 percent from the current 25 percent.
