Budget 2023_ Aviation industry seeks tax incentives for MRO sector, bringing ATF under GST, ET Infra

5/12/24, 4:30 PM Budget 2023: Aviation industry seeks tax incentives for MRO sector, bringing ATF under
seeks tax incentives for MRO sector, bringing ATF under GST, ET Infra
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Aviation 3 Min Read
Budget 2023: Aviation industry seeks

tax incentives for MRO sector,
bringing ATF under GST
The lingering impact of the pandemic and elevated aviation turbine fuel prices have made
the financial conditions of most Indian airlines fragile and they are still in need of government
https://infra.economictimes.indiatimes.com/news/aviation/budget-2023-aviation-industry-seeks-tax-incentives-for-mro-sector-bringing-atf-under-gst/97278606 1/14
5/12/24, 4:30 PM Budget 2023: Aviation industry seeks tax incentives for MRO sector, bringing ATF under GST, ET Infra
support.
Dev Kachari , • ETInfra

Updated On Jan 24, 2023 at 04:28 PM IST
Read by:
786 Industry Professionals
Read by
786 Industry Professionals
NEW DELHI: Given India’s

ideal geographical position,
placed between major Asian
and European countries,
stakeholders in the aviation
industry have been long
advocating policy measures
Representative image which will facilitate India to

emerge as a passenger and
aircraft maintenance, repair and operations hub in the world.
However, relevant policy measures, especially related to taxation have
been long pending and the industry expects Union Budget 2023-24 to
address those.
The Covid-19 pandemic gave fillip to Indian MRO companies with the
three major players - Air Works, GMR Aero Technic, AI Engineering
Services Ltd - undertaking substantial airframe maintenance in the
country.
Advt
According to industry leaders, the pandemic pushed the Indian aviation

sector to test MRO capabilities within the country but post-pandemic
the sector needs incentives to remain competitive.
“The key here is taxes and something we have been talking about with
the government. It is important that (aircraft) redelivery checks are
treated as export business and given the incentives or the treatment that
exports business deserves,” according to Anand Bhaskar, Chief Executive
Officer, Air Works, country’s largest private sector MRO.
“The challenge going forward is how do we ensure in the post-pandemic

scenario we remain competitive as we have during covid,” he added.
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Redelivery checks of commercial aircraft are undertaken when they

complete their lease period with an airline and are scheduled to be
returned to their lessor or deployed elsewhere.
“India’s potential to emerge as regional hub, even a global one, for MRO
services is quite well founded; it is however imperative that the
government provides a benign tax regime (e.g. lower corporate tax rate,
ability to carry forward tax losses in case of merger /M&A such that exits
are not expenses, and so on) to key strategic OEMs (original equipment
manufacturers) /investors looking to commit long-term capex in the
greenfield development of new MRO facilities.” said Sumit Singhania,
Partner, Deloitte India.
Advt
Industry body ASSOCHAM has called for introducing a production

linked incentive scheme for the MRO industry.
The lingering impact of the pandemic and elevated aviation turbine fuel
prices have made the financial condition of most Indian airlines fragile
and they are still in need of government support.
“The government did extend the ECLGS (Emergency Credit Line

Guarantee Scheme) to the aviation sector and also enhanced its scope,
thus providing some liquidity support to the airlines,” said Suprio
Banerjee, Vice President & Sector Head - Corporate Ratings, ICRA Ltd.
The scheme provides collateral-free liquidity at reasonable interest
rates.
“The industry expects to continue to receive similar credit support from

the government. The industry also needs favourable measures in terms of
taxation, with one of the recurring demands from the industry players
being rationalisation of duties on ATF and/or bringing it under the
purview of the goods and services tax (GST),” Banerjee added.
Making India an air cargo hub is also one of the ambitions that the
industry has been championing for some time but requisite financial and
policy measures are absent.
“To begin with, I think the industry is hoping for a removal of GST (goods
and services tax) on air freight as it is one of the biggest hindrances in
present times. This GST exemption would aid and encourage

international air cargo by significantly reducing cost structures,” said
Cyrus Katgara, Partner, Jeena & Company.
Kami Viswanathan, Senior Vice President, FedEx Express, Middle East

Indian Subcontinent and Africa (MEISA) Operations, has recommended
development and expansion of airports to meet the rapidly growing
demand for air cargo capacity and digitized systems to streamline
surging cross border shipments.
“We also recommend eliminating value and weight restrictions for

clearance under courier regulations. This will further boost exports from
India, especially for MSMEs engaged in cross border e-commerce, and
increase India’s competitive advantage as a manufacturing hub,”
Viswanathan added.
Published On Jan 24, 2023 at 04:28 PM IST
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budget 2023 mro suprio banerjee sumit singhania deloitte india
atf aviation airlines
Aviation 1 Min Read
Paris-New Delhi flight incidents:

DGCA slaps Rs 10 lakh fine on Air
India
Aviation regulator DGCA on Tuesday imposed a fine of Rs 10 lakh on Air India for not
reporting two incidents of unruly passenger behaviour onboard a Paris-New Delhi flight in
December last year.
PTI
Updated On Jan 24, 2023 at 03:56 PM IST
NEW DELHI: Aviation

regulator DGCA on Tuesday
imposed a fine of Rs 10 lakh
on Air India for not reporting
two incidents of unruly
passenger behaviour onboard
a Paris-New Delhi flight in
December last year. This is
the second time in less than a week that the watchdog has taken
enforcement action against the airline in connection with unruly
passenger behaviour.
In a statement on Tuesday, DGCA said the incidents of passenger

misbehaviour occurred on the AI-142 flight from Paris to New Delhi on
December 6, 2022.
One drunk passenger was caught smoking in the lavatory and not
adhering to the crew instructions, and another passenger allegedly
relieved himself on a vacant seat and blanket of a fellow female
passenger when she went to the lavatory, it said.
Advt
"Enforcement action in the form of a financial penalty of Rs 10,00,000

has been imposed on Air India for not reporting the incident to DGCA
and delaying in referring the matter to its Internal Committee, which is a
violation of applicable DGCA Civil Aviation Requirements," the
statement said.
Published On Jan 24, 2023 at 03:54 PM IST
dgca air india internal committee paris new delhi
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5/12/24, 4:30 PM Budget 2023: Aviation industry seeks tax incentives for MRO sector, bringing ATF under

News Leaders Speak Events Webinars Newsletters More

Roads and Ports and Urban Urban Infra More

ETInfra Newsletters Follow Us

Aviation 3 Min Read

Budget 2023: Aviation industry seeks

Dev Kachari , • ETInfra

NEW DELHI: Given India’s

Representative image which will facilitate India to

However, relevant policy measures, especially related to taxation have

According to industry leaders, the pandemic pushed the Indian aviation

“The challenge going forward is how do we ensure in the post-pandemic

Redelivery checks of commercial aircraft are undertaken when they

Industry body ASSOCHAM has called for introducing a production

“The government did extend the ECLGS (Emergency Credit Line

“The industry expects to continue to receive similar credit support from

present times. This GST exemption would aid and encourage

Kami Viswanathan, Senior Vice President, FedEx Express, Middle East

“We also recommend eliminating value and weight restrictions for

MOST READ IN AVIATION

Next round of airport

IndiGo takes the widebody

SIA Engineering to develop

Go First episode may lead to

Be the first one to comment.

Join the community of 2M+ industry professionals

Your Email Subscribe For Free

budget 2023 mro suprio banerjee sumit singhania deloitte india

atf aviation airlines

Aviation 1 Min Read

Paris-New Delhi flight incidents:

NEW DELHI: Aviation

In a statement on Tuesday, DGCA said the incidents of passenger

"Enforcement action in the form of a financial penalty of Rs 10,00,000

dgca air india internal committee paris new delhi

Join the community of 2M+ industry professionals

Email Subscribe For Free

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HRSEA HRME Education EnergyWorldMEA Manufacturing

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