Reduction in Rate of Tax on Aviation Turbine Fuel under the Tamil Nadu Value Added Tax Act, 2006
The Government of Tamil Nadu, Commercial Taxes and Registration Department, issued G.O. Ms. No. 105, Commercial Taxes and Registration (B2), dated 14th August 2018, to reduce tax on qualifying sales of aviation turbine fuel to scheduled airlines at airports other than metropolitan airports. The reductions applied only from the midnight of 15th August/16th August 2018 to the midnight of 14th August/15th August 2019, so they are no longer in force.
What the notifications did
G.O. Ms. No. 105, Commercial Taxes and Registration (B2), dated 14th August 2018, was published by the Government of Tamil Nadu, Commercial Taxes and Registration Department. It contained two notifications reducing tax payable by qualifying oil companies on certain sales of aviation turbine fuel, including jet fuel, under the Tamil Nadu Value Added Tax Act, 2006.
The reductions were temporary. They operated from the midnight of 15th August/16th August 2018 until the midnight of 14th August/15th August 2019.
Tax reductions
The two notifications provided:
- A reduction from 29 per cent to 1 per cent for sales of aviation turbine fuel, including jet fuel, to aircraft of scheduled airlines departing from airports other than metropolitan airports.
- A reduction from 5 per cent to 1 per cent for sales of aviation turbine fuel to scheduled airline aircraft with a maximum take-off mass of less than forty thousand kilograms, departing from airports other than metropolitan airports.
A metropolitan airport means an airport situated in a metropolitan area as defined in the Constitution (Seventy-Fourth Amendment) Act, 1992.
Conditions for eligibility
The reduced rates were subject to all of the following conditions:
- Passenger traffic at the airport in the previous financial year could not exceed 50 lakh passengers per annum.
- The fuel sale had to be for a domestic flight of a scheduled airline.
- The flight had to arrive after 23.00 hours and depart before 7.00 hours.
- The aircraft had to remain parked at the airport for at least three hours.
Monthly declaration requirement
The dealer had to submit a declaration completed and signed by the purchaser with the monthly return to the relevant assessing officer. The declaration recorded the invoice details, purchase value, domestic flight number, airline, destination, expected departure date and time, and confirmation that the aircraft had been stationed at the departing airport for three hours.
Relevance to property owners and buyers
G.O. Ms. No. 105 concerns taxation of aviation turbine fuel sold to scheduled airlines. It does not contain provisions about land ownership, property registration, planning permission, land use, building approval or property transactions.
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Common questions
Does this notification affect the purchase or registration of land in Tamil Nadu?
No. The notifications concern tax on qualifying sales of aviation turbine fuel to scheduled airlines and do not set out any requirements for land or property transactions.
Is the reduced aviation fuel tax rate still available?
No. The reductions remained in force only until the midnight of 14th August/15th August 2019.
Did the reduced rate apply at metropolitan airports?
No. It applied to qualifying departures from airports other than metropolitan airports.
What proof had to be submitted to claim the reduction?
The dealer had to submit a monthly declaration completed and signed by the purchaser with the monthly return to the assessing officer. It had to include flight and invoice details and confirm that the scheduled domestic aircraft was stationed at the departing airport for three hours.
