Mumbai: The state government cuts aviation turbine fuel tax from 18% to 7% as airlines face mounting operational pressure due to the West Asia crisis.
The Maharashtra government has announced a temporary reduction in Value Added Tax (VAT) on Aviation Turbine Fuel (ATF), lowering it from 18 per cent to 7 per cent for six months in a move aimed at supporting airlines struggling with rising fuel expenses. The revised tax rate came into effect on May 15 and will remain applicable until November 14, 2026.
According to an official notification issued under the Maharashtra Value Added Tax Act, 2002, the decision was taken to provide relief to the aviation sector amid increasing global fuel prices and supply disruptions linked to the ongoing West Asia crisis. The order was issued by the state Finance Department from Mantralaya in Mumbai and signed by Deputy Secretary Sanjay Kandhare.
The tax reduction follows discussions between the Ministry of Civil Aviation and several state governments, including Maharashtra, Delhi, Tamil Nadu and West Bengal, regarding lowering VAT on aviation fuel. Reports cited by Free Press Journal stated that these states currently impose some of the highest ATF tax rates in the country.
Due to the West Asia crisis, the Indian aviation industry is facing certain issues like air space closures, uncertain operations, spike in ATF prices. During these times, under the leadership of Hon'ble PM Shri @narendramodi ji, the government of India has given multiple respites… pic.twitter.com/Ayd671wWbq
— Ram Mohan Naidu Kinjarapu (@RamMNK) May 15, 2026
Union Civil Aviation Minister Ram Mohan Naidu Kinjarapu welcomed the move and thanked Maharashtra Chief Minister Devendra Fadnavis for implementing the reduction swiftly. In a post on X, the minister said that lowering VAT on ATF would help airlines manage operational costs more effectively and contribute to keeping airfares stable despite global economic pressures.
The minister also highlighted Maharashtra’s importance in the aviation sector, noting that the state has 16 operational airports and handles nearly 75 million passengers every year.
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