Govt plans Rs 500 as cess on air travel

New Delhi:The government is thinking of levying a cess on the growing number of air travellers to develop the smaller airports across the country.
The proposed cess, contained in the new civil aviation policy that has gone to the Union cabinet for approval, is of around Rs 500 per ticket. This could be bad news for budget airlines: if a ticket is for Rs 2,500, a Rs 500 cess means a sharp escalation of 20% on the fare.
This could blunt some of the competitive edge from the low-cost operators who have steadily weaned away passengers from the railways and, in the process, dramatically raised the number of air travellers.
05/04/06 Byas Anand/Times of India

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