THE FINANCIAL EXPRESS

NRIs seek cut in atf tax TO Lower Air Fares to Gulf

Kochi, November 20,2002

Non-resident Indians (NRIs) in the Gulf have demanded immediate slashing of the high tax imposed by the Kerala government on aviation turbine fuel (ATF). This was the main cause for the high air fare to the Gulf countries from destinations in Kerala.

In a memorandum submitted by the Pravasi Bandhu Welfare Trust, a Gulf-based organisation of NRIs to the state government, trust chairman KV Shamsudheen said that the tax of 39 per cent on ATF was very high. This had stood in the way of reducing air fares from the state.

During the recent visit of the Union civil aviation minister to Dubai, the trust had pointed out the unreasonably high air fare from Kerala to the Gulf destinations. The minister had then agreed to take up the matter with Air-India and Indian Airlines, he said.

The trust also forwarded a memorandum to the Prime Minister A B Vajpayee which it had placed on its website and had received good response. However, the Union civil aviation minister later informed the trust that the major reason for the high fare was the excessive tax levied by the state on ATF.

Mr Shamsudheen pointed to the case of Andhra Pradesh where NRIs had faced a similar problem. However, the Chief Minister there took cognisance of the issue and reduced the ATF tax to 4 per cent. As a result, the fare to Hyderabad from the Gulf was cheaper now. Traffic to Hyderabad had also increased.

Owing to the high tax of 39 per cent on ATF, efforts to persuade the Centre to reduce the air fare by national carriers had been hampered.

The memorandum had requested the government to slash the tax and then ask the Centre to reduce the fares. This, he said, would go a long way in helping the NRIs and through them the state.


Kochi, November 20,2002 Non-resident Indians (NRIs) in the Gulf have demanded immediate slashing of the high tax imposed by the Kerala government on aviation turbine fuel (ATF). This was the main cause for the high air fare to the Gulf countries from destinations in Kerala.

In a memorandum submitted by the Pravasi Bandhu Welfare Trust, a Gulf-based organisation of NRIs to the state government, trust chairman KV Shamsudheen said that the tax of 39 per cent on ATF was very high. This had stood in the way of reducing air fares from the state.

During the recent visit of the Union civil aviation minister to Dubai, the trust had pointed out the unreasonably high air fare from Kerala to the Gulf destinations. The minister had then agreed to take up the matter with Air-India and Indian Airlines, he said.

The trust also forwarded a memorandum to the Prime Minister A B Vajpayee which it had placed on its website and had received good response. However, the Union civil aviation minister later informed the trust that the major reason for the high fare was the excessive tax levied by the state on ATF.

Mr Shamsudheen pointed to the case of Andhra Pradesh where NRIs had faced a similar problem. However, the Chief Minister there took cognisance of the issue and reduced the ATF tax to 4 per cent. As a result, the fare to Hyderabad from the Gulf was cheaper now. Traffic to Hyderabad had also increased.

Owing to the high tax of 39 per cent on ATF, efforts to persuade the Centre to reduce the air fare by national carriers had been hampered.

The memorandum had requested the government to slash the tax and then ask the Centre to reduce the fares. This, he said, would go a long way in helping the NRIs and through them the state.