Mumbai, May 15 (PTI) The Maharashtra government reduced Value Added Tax (VAT) on Aviation Turbine Fuel (ATF) to 7 per cent from 18 per cent for a period of six months beginning May 15, an official said.

The decision was notified by the state Finance Department on May 14 under the Maharashtra Value Added Tax Act 2002.

"The concession will remain in force from May 15 to November 14, after which the previous rate would apply unless extended or modified by the government. The amendment substitutes the existing 18 per cent tax rate with 7 per cent in Entry 6 of Schedule B appended to the Maharashtra Value Added Tax Act 2002," an official notification informed.

The reduction in VAT is expected to lower fuel costs for airlines and could help improve air connectivity and competitiveness of airports in the state, the official added.

While the move is expected to provide relief to airlines, it will result in a revenue loss of around Rs 600 crore to the state exchequer, the finance department said. PTI MR BNM

Value Added Tax cut on aviation turbine fuel in Maharashtra lowers airline fuel costs under a six-month concession. Reduced Value Added Tax on Aviation Turbine Fuel in Maharashtra from 18 per cent to 7 per cent for six months under a notification issued pursuant to the Maharashtra Value Added Tax Act, 2002. The amendment substitutes the existing tax rate in Entry 6 of Schedule B, and the concessional rate remains in force until November 14 unless extended or modified by the government, after which the previous rate would apply.