TBM Staff - Mumbai The recent imposition of a 12.5% VAT on Aviation Turbine Fuel (ATF) at Bagdogra Airport has sparked concern among tourism stakeholders in North Bengal, leading to a formal appeal by the Himalayan Hospitality & Tourism Development Network (HHTDN) to Chief Minister Mamata Banerjee.
The HHTDN, representing key players in the region’s tourism industry, has requested the state government to reconsider the VAT decision, emphasising its potential negative impact on the local tourism economy.
Samrat Sanyal, GM, HHTDN, highlighted that the state’s earlier decision in 2013 to waive VAT on ATF at Bagdogra led to a significant increase in flight services, benefiting the tourism sector. The introduction of new flights at competitive rates was partly driven by the cheaper ATF available at Bagdogra, making it a more attractive option for airlines. However, with the recent reintroduction of VAT, some airlines have already reduced services, such as flights to Mumbai, leading to higher ticket prices and potentially deterring tourists.
Shankar Ghosh, the Siliguri MLA, pointed out that while VAT on ATF was reimposed at Bagdogra, it was reduced at Kolkata Airport, suggesting a bias against North Bengal. He warned that this could stifle the region’s growth, particularly in terms of air connectivity and passenger inflow.
The outcome of this VAT dispute could significantly influence the future of tourism and air travel in North Bengal, especially with the recent elevation of Bagdogra to a “point-of-call” airport, which could open the door for more international flights if the cost structure remains competitive.
