• Notification Date: 20-12-2024
• Notification No: N/A

Shares of IndiGo and SpiceJet in Focus as Govt Considers Inclusion of ATF Under GST

Aviation company shares such as InterGlobe Aviation (IndiGo) and SpiceJet will probably be in focus today, as the government is scheduled to discuss a potential game-changer for the aviation sector. At the 55th GST Council meeting, which will be held on December 21 in Jaisalmer, the government will consider bringing ATF or jet fuel under the GST regime.

This would be a huge relief for airlines, as it would save them a lot of operational costs and increase efficiency. Airlines have been demanding ATF to be included in the GST structure for long as it would reduce the cost of fuel, which is one of the highest expenses in the aviation sector. Jet fuel is currently taxed by states, and Delhi is one of the few states that charges a whopping 25%.

One significant development which the Maharashtra government brought recently is reduction of VAT from 25% to 18%, which was applauded by the aviation industry in March 2023, but it may turn into a notable breakthrough that is tax rates are going consistent to the whole nation. This is the most flammable petro-product used by airlines and helicopters for aviation; it's delivered in custom-built vehicles by either over-wing or under-wing refuelling. With agreement to incorporate ATF under GST, this is going to be able to help airlines fuel with streamlined processes at lower cost.

Union Finance Minister Nirmala Sitharaman will be present in the GST Council meeting along with representatives from all states and union territories. As the aviation industry awaits a favorable decision, this may well be the moment that the sector has been waiting for: the inclusion of ATF under GST.