The Maharashtra government has reduced the Value Added Tax on Aviation Turbine Fuel from 18% to 7%, effective until November 14, 2026. This move aims to provide temporary relief to airlines and stabilize airfares during the peak summer travel season. The reduction of 11 percentage points is in response to rising global fuel prices and the West Asia crisis impacting operational costs.
Civil Aviation Minister Kinjarapu Rammohan Naidu has welcomed the decision, emphasizing that it will help control airfares amidst escalating global challenges. This tax cut follows a previous reduction in 2023 when the state lowered the VAT from 25% to 18%. Union Commerce Minister Piyush Goyal has urged Congress-led Opposition governments in Kerala, Karnataka, and Telangana to emulate Maharashtra’s VAT reduction on Aviation Turbine Fuel.
Goyal highlighted the importance of such measures during crises and commended Maharashtra Chief Minister Devendra Fadnavis for the initiative. He noted that the reduced VAT will lower air freight charges, support exporters seeking new markets, and attract tourists. The Commerce Ministry is considering consolidating its presence in Mumbai to enhance efficiency and optimize space usage.
