Looking at the losses of the Coronavirus-hit Aviation industry in pile up India, the Ministry of Finance has decided to offer a rescue package worth $1.6 billion. Complete Coverage: Coronavirus
Crux of the Matter
About Rescue Package Ministry of Finance is considering a temporary curb on all types of taxation on the Aviation industry. Suspension of taxes will also include the deferment of aviation fuel taxes. Civil aviation ministry suggested an allocation of $1.6 billion in the rescue package. Furthermore, the Ministry may allow Airlines to pay taxes without interest in the coming tax cycle. The government will not levy taxes till threat from coronavirus decreases and companies get back on their own feet.
Regardless of any fiscal concessions and support the government may offer, most airlines will have to shrink their operations and the more vulnerable carriers may shutdown. – Centre for Asia Pacific Aviation’s (CAPA) India Unit
Impact of Coronavirus Coronavirus has forced airlines to shut down their operations, resulting in a massive loss of money and jobs. Governments across the world have shut down borders to prevent the spread of the virus, which directly impacted the airlines. In India, Vistara, Indigo, and GoAir have suspended international flight operations. It is estimated that Indian Airlines will report loss up to $600 million in the January-March quarter. The global oil price dip will be of little help in saving these struggling airlines as the major problem it faces is a slump in the demand due to shutdown and uncertainty in travels. Low demand and high competition may lead to the burning of the cash reserves of the companies.
Today I met Hardip Puri the MoCA to urge him in view of Coronavirus to cut Airline Turbine Fuel taxes, which is presently at a world highest at 40% of airline costs. Puri said he agreed and is seeking GST Council urgent meet for a comprehensive tax cut for our airlines — Subramanian Swamy (@Swamy39) March 13, 2020
Curiopedia
Air India had its origin as Tata Air Services later renamed to Tata Airlines founded by J. R. D. Tata of Tata Sons, an Indian aviator and business tycoon. In April 1932, Tata won a contract to carry mail for Imperial Airways and the aviation department of Tata Sons was formed with two single-engine de Havilland Puss Moths. On 15 October 1932, Tata flew a Puss Moth carrying air mail from Karachi to Bombay (currently Mumbai) and the aircraft continued to Madras (currently Chennai) piloted by Nevill Vintcent, a former Royal Air Force pilot and friend of Tata. The airline fleet consisted of a Puss Moth aircraft and a de Havilland Leopard Moth. Initial service included weekly airmail service between Karachi and Madras via Ahmedabad and Bombay. In its first year of operation, the airline flew 160,000 miles (260,000 km), carrying 155 passengers and 9.72 tonnes (10.71 tons) of mail and made a profit of ₹60,000 (US$840). More Info
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