From Apr. 1, shell out more to fly
Air-travel will get more expensive from April 1, with the government announcing an increase in service tax on air-tickets in the economy class while taxation on domestic travel in business class has also been hiked in the Budget for 2011-12.
This has triggered deep disappointment among air-travellers as well as travel agents.
Some of the private airlines are also disappointed that aviation turbine fuel (ATF) has not been put in the declared goods category which would have lowered ATF prices and made air-travel cheaper. But there’s some good news for national carrier Air India which has received `1,200 crore in budgetary support in 2011-12.
“I propose to raise the service tax on air travel by `50 in the case of domestic air travel and `250 on international journeys by economy class,” finance minister Pranab Mukherjee said in his Budget speech.
According to travel agents, the current service tax is 0.62 per cent of basic fare or `100 on every domestic economy class ticket and 1.24 per cent of basic fare or `500 on every international economy class ticket.
This will now go up to `150 and `750 respectively.
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