On Wednesday, the government brought down the excise duty on ATF or jet fuel to 11% from 14% previously. Since the year 2014, excise duty on ATF stands at 14%, much higher than the earlier 8%.
As per the media reports, the finance ministry was preparing a proposal to be submitted to the election commission to bring down excise duty on aviation turbine fuel to 8% from 14% .
The move will likely reduce financial burden on struggling airline industry amid depreciating rupee and surging crude oil price and thus will keep airfares under check.
EC's permission was sought in the matter as the model code of conduct is being implemented in 4 states in the wake of assembly elections.
On September 26, in order to curtail ballooning CAD and check rupee's further free-fall, government increased import duty on some 19 non-essential items including ATF. The customs duty on ATF was increased to 5% from 0%. The move sent the stocks of aviation companies including Spicejet, Jet Airways and Interglobe Aviation to record lows.