Reeling under a severe financial burden, representatives of airline companies have pleaded with the central government to have sustainable pricing model and reduce the prices of aviation turbine fuel (ATF).

According to sources, the airline companies have reiterated their demand for the inclusion of ATF under the Goods and Services Tax (GST) regime.

In a meeting with union ministers for petroleum & natural gas and civil aviation, the industry pointed out that it has lost thousands of crore in the past two years and cannot be expected to pass the entire increase in ATF prices to passengers.

The companies have reiterated their demand that states with higher air traffic should cut down on their value-added tax (VAT). ATF makes up to 40 percent of an airline’s operating cost.

ATF prices are revised on the 1st and 16th of every month based on the average of benchmark international rates. The increase in jet fuel price will raise the operating cost for airlines. Rates differ from state to state, depending on the incidence of local taxation.

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