The aviation ministry is talking to different states urging them to reduce VAT on aviation turbine fuel (ATF), Minister of State for Civil Aviation, Road Transport and Highways Gen V K Singh said on Thursday.
Speaking at a webinar organised by Bharat Chamber of Commerce, Singh said that this would help lower costs and attract more airlines to operate out of states that reduce VAT on jet fuel.
"Each state levies VAT (at different rates). Now realisation from VAT is hardly substantial for the states. We told the states to reduce the rates, Singh said, adding this would lower costs and help more airlines operate out of them.
Stating the aviation sector in India has huge growth potential, Singh said COVID has badly hit the segment.
However, he said slowly, the sector is coming back to normalcy.
Speaking on disinvestment in state-run Air India, Singh said the government has set September 15 as the deadline for bids.
"We should get the bids for Air India by September 15. Then a decision will be taken. If somebody wants to set the clock back, it is too late. We hope to get good bids", he said.
Singh also said functions of the Directorate General of Civil Aviation and Bureau of Civil Aviation Security are being streamlined.
He also said the ministry is eyeing development of the maintenance, repair and overhaul (MRO) sector in the country. "There are no MROs in India. We intend to incentivise them by extending long term leases. This will also benefit the MSMEs", he said.
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