Need ATF under GST now more than ever before: IndiGo CEO

ATF constitutes 45% of airline’s operational costs

On a day when aviation turbine fuel witnessed the steepest hike ever of 18%, IndiGo CEO Ronojoy Dutta said the need to bring it under GST was “now more than ever”.

Aviation turbine fuel (ATF) was increased by 17,135.63 per kl, or 18.3%, to ₹1,10,666.29 per kl in the national capital, according to a price notification by State-owned fuel retailers. The fuel’s cost has increased every fortnight since the start of 2022 and Wednesday’s was the sixth straight increase this year raising the cost by 50% over this time period

“This situation adversely impacts us, given that ATF constitutes over 45% of our operational costs. We have been in talks with the government to bring ATF under GST as it brings the benefit of input tax credit. We believe that such measures are needed now more than ever to offset this increase in cost and make flying viable for airlines and affordable for consumers,” Mr. Dutta said in a press statement.

The aviation industry has been demanding that ATF be brought under GST for the past five years and Finance Minister Nirmala Sitharaman said last month she would take up the issue with the GST Council at its next meeting.

Earlier this week, Minister for Civil Aviation Jyotiraditya Scindia said in Parliament that the cost of ATF had increased by 4.5 times since 2020. He said that following his requests, 12 States had reduced VAT on ATF from 25%-30% to 1% to 4%.