Govt considering slashing taxes on domestic air travel

ISLAMABAD: The government is considering slashing down Excise Duty and other taxes on domestic air travel during the upcoming budget for 2021-22 to support the aviation sector in Pakistan.

Pakistan is on top for imposition of tax burden on domestic air travel as for air ticket between Karachi and Islamabad, the tax rate stands at 33 per cent while in India’s Mumbai/Kolkata, the tax rate is 22.5 per cent. In Bangladesh, it is 7.3 per cent. In Malaysia, it is 2.5 per cent, in Sri Lanka 10.7 per cent and in Iran 8.6 per cent between two cities.

According to an official presentation given to the Economic Advisory Council (EAC) that was also endorsed and recommended to the government for slashing down taxes in a big way as the aviation sector is facing innumerable difficulties in the aftermath of the COVID-19 pandemic. They recommended the government to suspend Excise Duty on air tickets in the budget.