Global Airlines Group Urges Indian Government To Address GST Dispute

The International Air Transport Association, representing over 330 airlines and accounting for more than 80% of global air traffic, has called on the Indian government to resolve a significant Goods and Sales Tax dispute.

The issue involves show cause notices issued to 10 foreign airlines, totalling GST demands exceeding Rs 10,000 crore.

IATA expressed disappointment with the Directorate General of GST Intelligence for issuing these notices, despite multiple industry representations.

Xie Xingquan, IATA's regional vice president for North Asia and Asia Pacific (ad interim), criticised DGGI's assertion that GST should apply to expenses incurred by foreign airlines' headquarters with branches in India. He argued that this stance is inconsistent with international practices and unique to India.

The GST demands, affecting 10 foreign carriers, have been issued since October 2023. IATA has already presented a detailed representation to the Indian government and continues to advocate for a resolution.

Xie Xingquan emphasised that the international nature of air transport requires a globally consistent policy framework, warning that the ongoing dispute could jeopardise India's aviation sector.

This statement from IATA comes amid broader concerns about GST demands in other sectors, including a recent tax issue faced by IT major Infosys Ltd.

The IT industry's apex body, Nasscom, has criticised the tax demands as indicative of a broader misunderstanding of the sector's operational model, leading to unnecessary litigation and uncertainty.

(With inputs from PTI)