Patel seeks rollback of service tax imposed on air travel | india | Hindustan Times
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Patel seeks rollback of service tax imposed on air travel

Civil Aviation Minister Praful Patel on Wednesday sought complete rollback of 10 per cent service tax imposed on domestic air travel, while the Central Board of Excise and Customs (CBEC) said the rate should not be too heavy on airlines.

india Updated: Mar 03, 2010 18:55 IST

Civil Aviation Minister Praful Patel on Wednesday sought complete rollback of 10 per cent service tax imposed on domestic air travel, while the Central Board of Excise and Customs (CBEC) said the rate should not be too heavy on airlines.

"We will request for a complete rollback of service tax," Patel told reporters in Hyderabad.

The Civil Aviation Ministry would take up the issue with the Finance Ministry, Patel said, expressing the hope that the latter would respond favourably to the Civil Aviation Ministry's representation.

The Chairman of CBEC, V Sridhar, at a post-Budget seminar in New Delhi said that the government could consider a lower service tax rate on international and domestic air travel and is in talks with the airlines on the issue.

"We are having a dialogue (on service tax issue) with all the carriers and other stakeholders ... we should arrive at a rate which is not too excessive and should not pass undue burden (on passenger)," Sridhar said.

Finance Minister Pranab Mukherjee in his Budget had proposed a service tax of 10 per cent on both domestic and international travel.

"The service tax is charged at a flat rate of 10 per cent ... whether that is too heavy and whether we need to peg the rate at some different level (is to be considered)," CBEC Member YG Parande later told reporters in New Delhi when asked about the fallout of the tax on air travel cost.