Budget imposes 3 pc import duty, levies on planes

New Delhi, Feb 28: The budget for 2007-08 has proposed three per cent customs duty on aircraft and spare parts besides 16 per cent countervailing duty and four per cent special additional duty for import of such planes.

But imports by schedule airline operators and the government will be exempt.

Aircraft which are not registered in India, brought for the purpose of flight to or across the country and ultimately removed within six months from the date of arrival will, however, be exempt from all custom duties.

The import of aircraft including helicopters by the government and scdeduled airlines is at present exempt from all duties and that position will continue, said Finance Minister P Chidambaram, today.

''There is no reason to allow the exemption to other private importers,'' he said adding the levy of three per cent import duty is a WTO-bound rate.

The budget has also recommended duty reduction on air turbine fuel (ATF) on smaller new generation aircraft to keep in tune with turboprop aircraft.

In 2001, ATF sold to turboprops was included in the list of declared goods under section 14 of the Central Sales Tax Act.

Turboprop aircraft have been replaced by new generation small planes which have taken air services to remote parts of the country.

''Hence I propose to amend the provision to cover all small aircraft with maximum takeoff mass of less than 40,000 kg operated by scheduled airlines,'' said Mr Chidambaram.

UNI