The decision follows a push from the Civil Aviation Ministry to provide relief to domestic carriers struggling with high operational costs and global fuel price surges linked to geopolitical tensions.
Published: May 15, 2026 4:07 PM IST
Aviation Turbine Fuel update: In a move expected to provide relief to airlines and passengers amid rising operational costs due to the ongoing West Asia crisis, the Maharashtra government has reduced the Value Added Tax (VAT) on Aviation Turbine Fuel (ATF) from 18% to 7%. For those unversed, the economies around the world have been hit by the conflict between Iran and the US which started in February end, impacting global energy supply lines as the global energy choke point- The Strait of Hormuz was closed for a very long point in time. Here are all the details you need to know about the decision taken by the Maharashtra government on Aviation Turbine Fuel (ATF).
Union Civil Aviation Minister thanks Maharashtra Chief Minister for timely intervention
The reduction came into effect on Friday, Union Civil Aviation Minister Kinjarapu Ram Mohan Naidu said in a post on X. Naidu thanked Maharashtra Chief Minister Devendra Fadnavis for the “timely intervention,” noting that the decision would help keep airfares in check at a time when global challenges are pushing costs upwards.
“Maharashtra State has 16 operational airports and the highest annual air traffic amongst the states, of around 75 million passengers, with daily passengers of around 2 lakhs. This reduction in VAT will help the flight operations in all these airports and benefit the large number of passengers,” he said.
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What are the problems that the Indian aviation sector is facing?
The Indian aviation sector has been grappling with airspace closures, uncertain operations and a sharp spike in ATF prices following the escalation of tensions in West Asia. ATF typically accounts for 30-40% of an airline’s operating costs, making it one of the largest expense heads for carriers. With crude oil prices volatile due to geopolitical risks, airlines have faced pressure on margins and fare structures.
What steps is the government taking for helping the Indian aviation sector?
The Centre, under the leadership of Prime Minister Narendra Modi has already introduced several measures to cushion the impact under which it has capped ATF prices for domestic scheduled operators, reduced airport charges and extended support through the Emergency Credit Linkage scheme, Naidu said.
