Finance

Arun Jaitley

Services Tax

Business Insider

aviation


If all goes well, theMinsterwill be announcing GST (Goods &) in Budget 2017 that will be announced on February 1. This all-comprehensive tax would help businesses get a relief from the draconian tax regime in the country where the centre charges one and the state charges another. Paying one tax is blessing to most businesses and us, the commoners.However there is one sector, which would see a sudden rise in its spending – it’s aviation. Service sector will be badly hit by GST as per as spending is concerned. As a consequence, airfares would see a rise, whether it’s steep or slope, time will tell. Spokesperson of a popular low-cost airline on condition of anonymity told, there will be a double negative impact on air travel. While tickets would become expensive, since GST on tickets is higher than the current service tax, jet fuel is also not covered under GST, meaning that airlines will not be able to claim credit on the tax they pay on the fuel. At a time, when India’ssector has just opened up its wings, the experts are keeping fingers crossed till the budget day.For better understanding why GST in aviation would mean burning your pocket while flying, let’s explain you in the slideshow below.