Government may not roll back 10 per cent service tax on air travel proposed in budget 2010

he Budget proposal to charge 10 per cent service tax on air travel may not be rolled back, as the government expects to raise between Rs 600 and Rs 1,000 crore annually through the measure. Maintaining that the government plans to explore new avenues to mop up resources, a top official said, “at the moment it seems highly unlikely that there will be any roll-back on the service tax issue”.
The aviation industry has sought a reversal of the proposal to bring all classes of air travel in both domestic and international sectors industry under the service tax net, saying it would act as a “dampener” for the industry which is yet to come out of the red.