Notwithstanding the demand from the airlines, the government today said there was no proposal to bring Aviation Turbine Fuel (ATF) under GST.
"At present, there is no proposal to include ATF under GST," Minister of State for Civil Aviation Jayant Sinha said in the Rajya Sabha today.
Civil Aviation Minister Suresh Prabhu had earlier told PTI that the move will help cut the cost as airlines would get input tax credit.
ATF constitutes approximately 35-40 per cent of operational cost of an airline in India.
Sinha's statement come against the backdrop of Civil Aviation Secretary R N Choubey meeting senior officials of the Finance Ministry to impress the need for bringing ATF under GST.
Airlines, which are making a persistent demand for this, maintain that they would get an annual relief of Rs 3,000 to Rs 5,000 crore if ATF is included in GST.
In his written reply, Sinha said no analysis has been made on the impact of higher jet fuel prices on the airlines.
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