CNN Central News & Network-ITDC India Epress/ITDC News Bhopal: CHENNAI: The Tamil Nadu government has urged airlines to expand domestic and international flight services from Chennai airport following a significant reduction in value-added tax (VAT) on aviation turbine fuel (ATF). The move is aimed at reducing airline operating costs, strengthening air connectivity and encouraging carriers to introduce additional flights and new destinations.
The State government recently reduced VAT on ATF supplied to scheduled airlines at Chennai airport from 29% to 16%. At other airports across Tamil Nadu, the rate has been cut from 29% to 1%. The revised rates are scheduled to take effect from November 1, 2026, and remain applicable until October 31, 2027.
According to sources cited in The Hindu, airlines have assured the government that they will increase flight operations following the tax reduction. One of the largest airline operators at Chennai airport has reportedly indicated a potential increase of nearly 25%, while another major carrier has promised an increase of around 8%. However, neither has provided a definite timeline for implementing the changes.
The government has also requested airlines to consider introducing a direct flight between Chennai and Japan. Discussions involving the State government, the Airports Authority of India and airline representatives have focused on improving connectivity and serving more domestic and international destinations.
IndiGo, Air India and Akasa Air have welcomed the reduction in fuel taxes. Officials hope the measure will improve Chennai’s competitiveness as an aviation hub and support regional tourism, trade and business travel.
However, the actual increase in flight services will depend on airline decisions, passenger demand and route viability. The government is expected to assess progress as airlines finalise their upcoming schedules.
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