Top News:

Union Budget 2016 expectations: What budget carrier Spicejet CMD Ajay Singh wants from Arun Jaitley

Wed February 24 2016, 11:43 pm
  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    Budget 2016 expectations from Spicejet: With FM Arun Jaitley's Union Budget 2016-17 set to be presented in within a few days, Spicejet CMD Ajay Singh has revealed what he, and the aviation industry in general, wants from the Narendra Modi government - PM has taken special interest in the preparation of the budget this time. Here are the top points on Ajay Singh's mind:

  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    I. Budget 2016 expectations from Spicejet: Direct Tax Proposals (Income Tax) 1. Exemption from Minimum Alternate Tax (MAT) airlines in India have been operating in a hostile cost environment and being a long term gestation industry, there has been a huge amount of accumulated book losses (including unabsorbed depreciation) in the whole sector. It is requested that airlines should be exempted from application of MAT till all the accumulated book losses (including unabsorbed depreciation) are set off against future book profits.

  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    Budget 2016 expectations from Spicejet: 2. Reinstatement of Sec 10 (15A) of the Income Tax Act - Exemption from withholding tax on aircraft / engine lease rental payments and obligations arising out of lease agreements. Lease rentals for aircraft and aircraft engines were exempt from Income Tax under section 10 (15A) of the Income Tax Act, 1961. This exemption has been withdrawn w.e.f. April 1, 2007 and withholding tax was imposed. All the Lease Transactions take place outside India and there is virtually no tax revenue on this account to the Government of India. This section should be reinstated.

  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    Budget 2016 expectations from Spicejet: 3.Exemption from applicability of Section 206AA of Income Tax Act in respect of Non-Residents payments. Due to non-availability of requisite services in India, airlines enter into various agreements with foreign entities that insist on recieving payments net of Indian taxes. To avoid issues with Indian tax authorities, the foreign entities do not want to take PAN in India and airlines are forced to pay taxes on behalf of these entities. Such amounts are disproportionately high and add to airlines losses. It is requested that the provisions of Section 206AA should not be made applicable to foreign entities.

  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    II. Budget 2016 expectations from Spicejet: Indirect Tax Proposals (Service Tax) 1. Increase of abatement available to the Air Transport of Passengers from 60% to 80% so that the effective service tax rates comes down to 2.8%. The upper limit of Service Tax on ticket price, up to March 2012, were Rs.150 and 750 in respect of domestic travel and international travel respectively, however w.e.f. April 1, 2012, a new scheme of service tax has been introduced wherein the service tax is charged on the full amount of the ticket with an abatement of 60%. This change has made air travel more costly. It is requested that the abatement on service tax on ticket price should be increased to 80%. We would further like to request that it may be clarified that the above abatement is always applicable to all the passenger related revenues earned by the airlines.

  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    Budget 2016 expectations from Spicejet: 2. Availability of CENVAT Credit on Excise Duty Paid on ATF. As the fuel cost in the Aviation Business comprises more than 50% of the total cost, therefore it is requested that CENVAT benefit may be allowed against excise duty paid on ATF.

  • economic survey 2016, economic survey of india 2016, 2016 economic survey, budget 2016 economic survey, indian economic survey 2016-17

    Economic Survey 2016: Arun Jaitley had met economists as part of pre-Budget meetings in January. During that round, he had also met industry captains, bankers, farmers and trade union representatives. The economic survey is prepared by the Chief Economic Advisor.

  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    Budget 2016 expectations from Spicejet: Aircraft acquisition and leasing - We need to allow our financial institutions to purchase aircraft and lease it to airline operators. Right now only scheduled operators are allowed to import aircraft on complete acquisition basis without import duty.

  • Budget 2016, budget 2016 expectations, Budget news, Budget latest news, Budget expectations, spicejet offers 2016, spicejet offers today, spicejet rs 599 offer, spicejet ticket sale offer

    Budget 2016 expectations from Spicejet: ATF to be considered as declared Goods - Recommendations for immediate action to bring ATF cost at par with other competitive markets: 1. ATF pricing should be based on actual costs not import parity; 2. All the elements of cost should be based on actual cost of efficient operations in a transparent manner and should be subject to audit and validation by airlines; 3. Private sector oil companies should be permitted at all the airports in open access; 4. ATF should be notified as ‘Declared Goods’ with concessional rate of 4% as VAT.

  1. R
    Rajkumar
    Feb 28, 2016 at 6:33 am
    Setudent
    Reply

ANALYSIS / EXPERT COMMENTS

Go to Top