The Hindu Business Line : Aviation Ministry to seek extension of tax holiday on leasing aircraft

THE Minister for Civil Aviation, Mr Praful Patel, on Thursday said that he would speak to the Finance Minister, Mr P. Chidambaram, and get another extension on the implementation of the withholding tax on lease payment for aircraft.

"We will speak to the Finance Minister and try and get an extension. This is our wish list," Mr Patel said at a function organised to launch Air Deccan's flight between Delhi and Dehradun.

Mr Chidambaram, in his Budget speech 2004-05, had proposed that any payment made by an Indian company to acquire an aircraft or an aircraft engine on lease from a foreign enterprise or State will not be exempt from tax.

However, the Government later decided to postpone the implementation of the decision till April next year. Emphasising the need for increasing air connectivity in the country, the Minister said that both Indian Airlines and Alliance Air were looking at acquiring smaller aircraft so as to connect the smaller towns and cities. "Within the next few months Alliance Air should get some smaller aircraft. The number of smaller aircraft the airline is likely to get will be decided by it. But it could get six small aircraft to start with," Mr Patel said.

Airport security: On the theft of radar equipment at Mumbai airport, the Minister said that the Government was taking the issue very seriously. "We are reviewing airport security. The theft is a question of overall security."

Commenting on the growth of the aviation market, the Minister said that in the last six months alone the domestic market had seen a surge of 30 per cent. Besides, international airlines had added another 6,00,000 seats during the peak season.