State urged to reduce tax on turbine fuel
TIMES NEWS NETWORK
Chennai: Union minister of civil aviation Praful Patel on Monday urged the state to reduce the sales tax on Aviation Turbine Fuel (ATF). The high taxes could see Chennai airport losing out to Hyderabad and Bangalore in the race to become the aviation hub in southern India, he hinted.
“The government should give incentives to the airlines to encourage them to fly into Chennai, like how the semiconductor industries are attracted,” he said during the inauguration of the Rs 1,808-crore airport expansion project.
Chief minister M Karunanidhi inaugurated the project that involves extending secondary runway, constructing domestic and international terminal building and other modern amenities. It is scheduled to be completed in December 2010.
Patel said:
“The state charges 29% sales tax on ATF while Kerala, Andhra Pradesh and Karnataka have reduced it to 4%. High taxes will force airlines to prefer other airports.” Karunanidhi did not make any statement in response.
Patel said the state should hand over land for a parallel runway.
The greenfield airport at Sriperumbudur, he said, “can be kept as a standby because the existing airport after development will be enough to handle the traffic for the next 10-15 years.”
Of the 35 non-metro airports being developed, three are in Tamil Nadu. “Work on the first phase will be completed at Tiruchi airport while work has begun for Madurai airport. We need more land at Tuticorin and Coimbatore. When all this is completed the state will have a major role to play in civil aviation. Hence, the government should support by handing over land and by also luring airlines to operate,” Patel said.
K Ramalingam, chairman, AAI said: “We have asked the state to hand over land required for developing airports.”
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