Aviation Operators Association of Bangladesh (AOAB), the apex organization of the country's private airlines, demanded a tax waiver on importing parts of aircrafts and helicopters in the upcoming budget of FY 2023-24.
The officials of the organization said that these taxes were now a burden for the fragile aviation sector of the country.
AOAB revealed this demand in a letter regarding the upcoming budget of FY24 during a meeting with the National Board of Revenue (NBR) in the capital on Tuesday.
Mafizur Rahman, organizing secretary of the organization, also managing director of Novoair, issued the letter.
The parts of aircraft and helicopters have become costlier nowadays, the letter read, noting that currently they have to pay 5% as imposed tax, 5% as advance tax (AT), and another 5% as advanced income tax (AIT) and sometimes the tax exceeds to nearly 100% which create an abnormal financial pressure on the aviation sector.
In this situation, doing business has become impossible as 26% tax on importing parts remains, the letter read.
Urging to abolish 15% VAT on the jet fuel of domestic flights, AOAB said that the price of fuel oil in the domestic market is noticeably higher than the international market.
In many countries of the world, there is no difference between domestic and international prices of jet fuel. Even India has decreased the VAT on domestic flights at a mentionable rate due to a hike in fuel oil.
The AOAB also demanded to reduce overall taxes on domestic flights. Due to the excess tax rate, the price of air tickets has gone beyond the reach of the passengers, the letter read.
The secretary general of the organization said that there is a lengthy process in importing parts due to some non-clarification regarding import tax on aircraft, engines, and its parts which left the aviation sector and its entrepreneurs on a brink of destruction.