Airlines may get relief from withholding tax

New Delhi: The Budget is all set to bring cheer for airlines by not imposing withholding tax on aircraft lease rentals.
The tax is likely to be scraped by finance minister P Chidambaram on the basis of requests from civil aviation minister Praful Patel, sources said. This would mean significant savings for airlines, as most Indian carriers use a large number of leased aircraft. Indian is expected to lease more Airbus A319 aircraft while Air-India is making plans to lease a number of Boeing aircraft including some B737-800s.
The government had exempted the airline industry from withholding tax, primarily to help these two airlines. Airlines didn’t have to pay the tax as the government kept extending the exemption.
20/02 Economic Times

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