Daijiworld Media Network - Mangaluru (SP)

Mangaluru, Mar 2: Because of exorbitant value added tax (VAT) being levied in Karnataka on Airline turbine fuel (ATF) as compared to Kannur in Kerala, new flights are dithering to fly from Mangaluru as Kannur is more lucrative. As such, it is learnt that there was considerable decline in both the number of flights and passengers served at the local airport during last year.

The state has been levying VAT of 28 percent on aviation fuel whereas in Kannur the rate stands at only one percent. Kannur is just 175 km away from Mangaluru. Automatically airfares from Kannur are considerably less as compared to Mangaluru. The concession in VAT is given only for Kannur by the chief minister. Even though this step has attracted criticism and political tussle there, it has proved to be detrimental for Mangaluru airport.

Mangaluru International Airport (file photo)

During the period from April to November 2019, Mangaluru airport has recorded 23 percent decline in passenger traffic. Number of flights too came down from 13,960 to 10,416 particularly because of the exit of Jet Airways and no other operators have introduced as many flights in its place.

Passengers from even Kanhangad in Kerala relied on Mangaluru airport earlier but they have now opted to travel by Kannur because of cheaper airfares. There are cases in which even passengers from Mangaluru have opted to travel to Kannur from foreign destinations and then taken a taxi here. Unless competitive edge is established by some means, the performance of this airport may be affected further.