MUMBAI: Kingfisher Airlines Ltd has said it would reduce airfares “across the board” as soon as the Indian government brings aviation turbine fuel (ATF) under the declared goods category.
“Kingfisher will immediately reduce airfares across the board as soon as the declared goods classification is approved for ATF,” Chairman Vijay Mallya said in a statement late on Monday.
Mallya was responding to the Finance Minister P Chidambaram’s announcement to introduce a bill during the forthcoming Parliament session to bring ATF under the declared goods category.
The declared goods status on ATF would attract a uniform sales tax of 4% across the country. ATF is currently taxed by between 4-30% across the country.
The airline had posted a net loss of Rs6.4 billion for the six months to 30 September, hurt by high jet fuel costs and low demand. ATF accounts for nearly half of an airline’s operating costs.
Shares of Kingfisher were up 5.71% at Rs25.15 in the Mumbai market.