Planning Commission objects to further levies on air travelers

New Delhi: The Planning Commission has opposed a civil aviation ministry proposal to impose an airport development fee on passengers. The fee would be applicable over and above various surcharges like fuel surcharge, congestion cess, and passenger service fee (PSF) that are paid in addition to the basic fare.

According to a civil aviation ministry proposal, included in the proposed Airports Economic Regulatory Authority (AERA) Bill 2006, due for presentation in the Budget session of the Parliament, an Airport Development Fee (ADF) and User Development Fee (UDF) would be levied on passengers. The development fee would be applicable in the case of airports where annual passenger turnover is over 15 lakh and would be used for upkeep and development of such airports.

According to government sources, the Planning Commission has put a spoke in the ministry's proposal by pointing out that the PSF, in any case, was meant to provide facilities at airports, and so there would appear to be no need to impose a separate airport development fee.

As for the various levies already being collected by the government, Rs221 is collected from passengers by way of PSF for security and other facilities at airports, Rs750 by way of fuel surcharge from airline companies and a further Rs150 as congestion cess from each airline ticket.

While concession agreements for Delhi, Mumbai, Bangalore and Hyderabad international airports already contain a provision to impose such development fees, the civil aviation ministry intends to take matters further by bringing all major airports under the ambit of this development charge. The Planning Commission would appear to have demurred by pointing out that imposing development fee on passengers under a different head does not seem appropriate.

According to sources, the Commission has also suggested that such charges should form part of airport tariffs collected from airline companies rather than from as levies on air passengers.