Economy News Notes

Oil firms oppose Kingfisher move to import ATF

• As the government mulls allowing Kingfisher Airlines to import ATF (aviation turbine fuel) directly, oil companies have opposed the move saying the proposal is “bad economics” for the beleaguered airline in view of high taxes and handling cost.
• Oil firms have stated that India is surplus in jet fuel and exports half of its production annually.
• Kingfisher believes that by importing ATF directly, it can make substantial savings by not having to pay sales tax (which varies between 4 to 30 per cent from state to state).

  Oil firms, however, said the airline would have to pay 12.83 per cent duty on the imported ATF
• In 1995-96 when import of ATF was undertaken on behalf of ATOs (Air Transport Operators) and airlines against Special Import Licence, additional entry tax was levied by state governments, the oil companies pointed out.