India To Standardize Import Taxes Related To Aircraft, Components & Engines.

India will now tax all imports of aircraft components and aircraft engine parts at a uniform rate of 5%, announced the Civil Aviation Minister on Monday. Previously, the tax rates for these imports varied between 5% and 28%.

This new rate, effective immediately, was recommended by India's Goods and Services Tax (GST) Council in June. It applies to imports of "parts, components, testing equipment, tools, and tool-kits of aircraft."

The change was deemed necessary due to the "challenges" posed by the varying tax rates and is expected to benefit local maintenance, repair, and overhaul (MRO) businesses, according to Civil Aviation Minister Kinijrapu Rammohan Naidu. This policy update comes at a time when Indian airlines have placed record orders for jets.

"This new policy eliminates disparities, simplifies the tax structure, and fosters growth in the MRO sector," the minister said.

India is one of the fastest-growing major aviation markets, with the aircraft fleet expected to increase from the current 700 to over 1,500 by 2030.