BHUBANESWAR: The state cabinet on Monday approved the proposal to reduce VAT to one per cent on sale of aviation turbine fuel (ATF) in Odisha including the non-regional connectivity scheme (non-RCS) at Biju Patnaik International Airport (BPIA) here.
Earlier on August 22, 2017, the state government had reduced VAT on ATF to one per cent under RCS-UDAN scheme only at RCS airports for RCS flights for a period of 10 years. The state government has now decided to reduce VAT to one per cent on sale of ATF to RCS fixed-wing aircrafts, helicopters, seaplanes at any airport, heliport, helipad or water aerodrome located within Odisha.
Chief secretary Suresh Chandra Mahapatra told mediapersons that this will supersede the earlier notification of the Finance department for RCS airports and will be co-terminus with the validity of the earlier notification till August 21, 2027.
Presently, Jharsuguda, Rourkela, Jeypore and Utkela are recognised as RCS airports in the state under the UDAN scheme. The oil marketing companies based out of these RCS locations are selling ATF to the RCS aircrafts with reduced VAT of one per cent.
Mahapatra said all these airports are either connecting or being planned to connect BPIA at Bhubaneswar. However, being a non-RCS airport, reduced VAT of one per cent on ATF was not applicable at the BPIA, he said.
With the implementation of this proposal, Bhubaneswar will captivate the RCS airline operators to have their operational base at BPIA. This will enhance regional air connectivity, attract investment of airlines, generate employment and also reduce cost of travel, he said.