NEW DELHI: An Indian government panel has rejected an airline industry proposal for aviation fuel to be brought under the unified Goods and Services Tax (GST), the finance minister said after a meeting of the panel on Saturday.
Currently, state governments choose how to tax aviation turbine fuel (ATF). Airlines have been lobbying to include it in the GST regime so the levy is the same nationwide, but state authorities have opposed that, fearing they could lose revenue.
“States do not want ATF to be brought under GST just like petrol and diesel,” federal Finance Minister Nirmala Sitharaman said after Saturday’s meeting of the Goods and Services Tax (GST) Council.
The council is chaired by Sitharaman and includes state government representatives.
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The tax panel also decided to impose 18% GST when all used or old vehicles, including electric vehicles, are sold by registered sellers. Such vehicles sold directly between two individuals will not attract tax.
It deferred plans to slash taxes on some life and health insurance premiums, a move that was seen as key to getting more Indians to sign up for coverage. Sitharaman said the proposals required further discussion.