Govt imposes VAT on airfare, ticket costs to increase

KATHMANDU, July 16:The government has decided  to implement Value-Added Tax (VAT) on air fares from the new fiscal year 2023/24, the new fares will be implemented from Monday.  The Airline Operators Association of Nepal (AOAN), the airline's umbrella organization, released a statement stating that the fares will be imposed from Monday.

Airlines have begun preparations to introduce the new pricing. According to the AOAN, the new charge will be around 6% more than he normal fare.

According to the airline, the new fare would be higher than the previous one. According to the airlines, it will be around 6% more expensive. According to Yograj Kandel, AOAN spokesperson, "the air fare will now increase." The ticket price includes a 13 % VAT. All companies finished the VAT registration process. We will convert our PAN into a VAT.

He stated that the tax department has already written to all airlines requesting that they submit the details of the amount by August 10th.

Previous to the new fiscal year's budget, the government charged 1% customs duty on different items, including engine propellers, and plane prices were also calculated without VAT. Airlines that were unhappy with the government's choice outlined in the budget eventually agreed.

Domestic airlines such as Buddha Air, Yeti Airlines, Shree Airlines, Saurya Airlines, Guna Airlines, Tara Air, Sita Air, and Summit Air which are flying domestically, have been charging fuel surcharge, airport service fee, and airfare.