Economy air travel may face service tax

New Delhi: After taxing business class air travellers, the government is now eyeing the economy class travellers and may bring the service in tax ambit in the Budget 2007-08.
The revenue department has already taken inputs from the industry about the tariff structure, service tax paid by them and the value on which it is calculated and method of its sale. The tickets have components like basic fare, fuel surcharge and airport tax or the passenger service fee. These details are sure to come handy for department when it examines the proposal to bring economy class air travel under service tax.
At present, the premium-class air travel attracts a service tax of 12%. The tax is levied on the basic fare. The government is also likely to look at the other components of airline trade. For instance, a Delhi-Mumbai airticket may carry an additional burden of Rs 960 if the service tax is imposed.
05/01/07 Sunny Verma& Deepshikha Sikarwar/Economic Times

To Read the News in full at Source, Click the Headline