It has been one year since the union govt. of India implemented the biggest tax reform policy as GST (Goods and Service Tax). It was first drafted in the year 2006-07 by then Prime Minister of India, Dr. Manmohan Singh.
Although, from the day it was implemented in India last year it faced a lot of criticism from different business corridors. Be it diamond industry or textiles, everyone criticised this sudden move by the government.
Now in another move union govt. of India did something unexpected. Recently, govt. has directed the airline companies to operate their services with GST. This decision has triggered the International flight operators across the globe.
Levying GST on international air tickets violates international norms and also weakens the competitiveness of carriers, IATA chief Alexandre De Juniac said.
He also flagged various concerns about the Indian aviation sector, including high jet fuel prices, infrastructure woes and privatization of airports. The International Airport Transport Association (IATA) is a group of more than 280 airlines. Air India, Jet Airways and Vistara are also members of this group.
Speaking at a conference, De Juniac said goods and services tax (GST) on international air tickets violates International Civil Aviation Organization (ICAO) norms and also weakens the competitiveness of carriers. ICAO is a part of the UN and is a global aviation body.
The GST rate is 5% and 12% on the economy and business class tickets, respectively.
The IATA’s Director General and CEO also said that India’s aviation sector is projected to see 500 million trips “to, from and within” by 2037.
India’s civil aviation sector has recorded 50 months of double-digit growth and it can be “very easily maintain (that) for next 50 months, provided that all nuts and bolts are in place”, Civil Aviation Secretary R N Choubey said.
Well, it would be interesting to see that how it will affect the flight operations between India and The World. What do you have to say about it? do let us know in the comments section below.