Maharashtra Slashes VAT on Aviation Fuel from 18% to 7%
The Maharashtra government reduced Value Added Tax (VAT) on Aviation Turbine Fuel (ATF) from 18% to 7% , effective May 15, 2026. Union Civil Aviation Minister Kinjarapu Ram Mohan Naidu confirmed the move on X, thanking Chief Minister Devendra Fadnavis for the “timely intervention.”
The numbers
Maharashtra has 16 operational airports handling approximately 75 million passengers annually (roughly 2 lakh daily passengers).
Why it matters for B2B:
ATF accounts for 30-40% of an airline’s operating costs. This cut directly improves airline margins on flights operating out of Mumbai, Navi Mumbai, Pune, and Nagpur. For corporate travel buyers and tour operators: expect potential fare stabilization or slight softening on Maharashtra-origin routes. For DMCs: this makes Maharashtra a more competitive aviation hub versus neighboring states with higher VAT rates (which range from 4% to 30% across India).
“This reduction in VAT will help the flight operations in all these airports and benefit the large number of passengers.”
— Kinjarapu Ram Mohan Naidu, Union Civil Aviation Minister
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