Aviation stocks soar as Delhi govt cuts tax on ATF

Airline stocks rose by up to 3 per cent on Wednesday after the Delhi government said VAT on Aviation Turbine Fuel (ATF) will be brought down from 25 per cent to 1 per cent for flights to remote areas such as North Eastern states.

Shares of Jet Airways soared 3.07 per cent, SpiceJet climbed 2.86 per cent while IndiGo's parent company InterGlobe Aviation rose 2.26 per cent on BSE.

Air travel from Delhi to remote areas will be cheaper with the AAP government today announcing slashing of VAT on ATF from existing 25 per cent to 1 per cent to compliment the Centre's regional connectivity scheme (RCS).

Presenting the Delhi budget for 2017-18, Deputy Chief Minister Manish Sisodia said the cut in VAT on ATF will be applicable for direct flights between Delhi and remote areas identified under the RCS scheme as per prescribed conditions.

Sisodia said the decision to cut the VAT on ATF will benefit people from the North East and other remote areas as fares under RCS will come down significantly.