Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
Popular Search: cpt :: ARTICLES ON INPUT TAX CREDIT IN VAT :: ACCOUNTING STANDARD :: form 3cd :: VAT Audit :: due date for vat payment :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: TDS :: ACCOUNTING STANDARDS :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: articles on VAT and GST in India :: Central Excise rule to resale the machines to a new company :: VAT RATES :: empanelment
General »
 Simplified one page Income Tax Return Form: Changes to keep in mind before filing tax return for AY2017-18
  No proposal to replace Income Tax with Banking Cash Transaction Tax
 GST coming July 1 despite calls for delay: Revenue Secretary Hasmukh Adhia
 Centre introduces provision of taxation on NPS in Income Tax Act
 Income Tax Department Clarifies On Cash Withdrawal From Banks, Post Offices
 The Goods And Services Tax (Compensation To States) Bill, 2017
  Goods and Service Tax (GST) and Real Estate Sector
 New Income Tax Rules On Home Loan Come Into Effect
 Here's how late filers can save on stress and taxes
 Clarifications on the Taxation and Investment Regime for Pradhan Mantri Garib ?Kalyan Yojana, 2016
 Companies should invest in upgradation of tax technology

Domestic flights get costlier by 5 to 15% this week
June, 20th 2008

Flying just got even more expensive with domestic airlines hiking fares by 5% to 15%, the second such move this month.

In the beginning of June, airlines had hiked the fuel surcharge following yet another increase in jet fuel prices. This time, they have decided to hike basic fares on three different route categories.

Jet Airways and Air India-domestic (Indian Airlines prior to merger) say flights covering a distance of up to 750km will have a minimum basic fare of Rs 1,000.

For distances between 750 and 1,000km, they announced a minimum fare of Rs 2,250. Routes above 1,000km will have a minimum base fare of Rs 3,000. The base fares will be topped up by fuel and congestion surcharge of Rs 3,275 for distances below 750km and Rs 2,625 for longer flights.

Which means, the minimum fare from Delhi to any other metro city will be Rs 6,275 which around four months back was around Rs 4,000. Jet said the hiked fares became effective from Wednesday and AI announced the changes will come into effect from Friday.

Kingfisher-Deccan combine said it will make an announcement in a couple of days. Even low cost carriers (LCCs) have become more expensive. Jet Airways CEO Wolfgang Prock-Schaeur announced that JetLite's minimum basic fares on the three distances would be Rs 500, Rs 1,500 and Rs 2,000.

Following the 19% hike in jet fuel prices earlier this month, SpiceJet didnt hike fuel surcharge, which other carriers had raised to Rs 2,250 from Rs 1,950 for distances up to 750km and from Rs 2,350 to Rs 2,900 on longer flights.

SpiceJet had instead hiked basic fares on these flights by Rs 300 and Rs 550, respectively equivalent to the hike in surcharge. Now from Friday, said the airlines VP (marketing) Kamal Hingorani, the surcharge will also be increased to the industry level. "Earlier, talks were on between various stakeholders to reduce sales tax on jet fuel. But now with those prices not falling, we have to increase the surcharge," he said.

Despite these hikes, airlines say, they are not able to cover their costs and expect a loss of over Rs 8,000 crore this fiscal. In the latest hike, the government has increased fares by 5% to 15%, the second such move this month.

The latest hike will mean a further slackening of demand as now fewer people can afford to fly. This, said industry players, will mean further reduction in number of flights something that will hit connectivity.

"I feel there's an overcapacity of 25% (in terms of number of seats offered on domestic flights) in the market and we are looking at cutting flights. The past four jet fuel price hikes have meant a 50% increase in our fuel bill. Jet Airways alone is spending $70 million extra every month. The cost base for the entire industry on an annual basis has gone up by $1.2 billion," said Jet Airways CEO Wolfgang Prock-Schaeur.

Flyers in south India will have to bear an additional burden of paying user development fees (UDF) at the new airports of Hyderabad and Bangalore.

At Hyderabad, where UDF will kick in from June 23 when the new airport completes three months of operation, the developer has proposed a fee of Rs 600 per passenger for flights going to other states and Rs 350 for those flying with AP. Similar fees will charged at the new Bangalore airport after it completes three months.

The aviation ministry's attempts to ask states to reduce sales tax on ATF came to naught recently when airlines told it that they would not be passing on the benefit of lower taxes to passengers. States have said they can consider reducing tax rates only if the passengers get some benefit. But with airlines facing big losses, that doesnt seem likely. The end result flying is getting increasingly costly by the day.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2017 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Reengineering Software Re-engineering Software Reverse Engineering Software Reverse Development Software Change Modulation Software Conversion Software Re-creation Software Re-development

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions