After the airline suspended flights to Egypt are asked to zero VAT on domestic flights

MOSCOW, November 13. Russian airline members of the Association of air transport operators (air transport operators Association), on the background of the suspension of operations in Egypt has asked the government to support the industry, special economic measures, including zero VAT on domestic destinations.

The corresponding letter (available) sent to Deputy Prime Minister Arkady Dvorkovich.

“In order to support the Russian airlines Russian air transport operators Association asks you to give an instruction to consider the following proposals: to introduce a zero VAT rate on domestic air travel, including to extend the term of section 4.1 of article 164 of the Tax code of the Russian Federation (air travel to the Crimea), to increase 1.5 times the amount recoverable from the budget of the Russian Federation the excise tax on aviation fuel, to introduce a mechanism of compensation of interest rates on credits attracted by Russian companies in Russian banks”, – stated in the letter.

The paper noted that the aviation industry continues to experience financial problems, losses of the Russian carriers for the first half of 2015 amounted to more than 28 billion rubles, the suspension of flights to Egypt, according to the airline only this year will lead to financial losses in the amount of 9 billion rubles.

There remains a trend for a decrease in international traffic and, accordingly, the increase in domestic transportation (for 9 months of 2015, the transportation of passengers on international routes decreased compared to the same period in 2014, by 13.8%, while domestic traffic increased by 16.1% – approx. ed).

The implementation of these measures, Russian air transport operators Association proposes to implement from 1 January 2016, which, according to the Association, “not only stabilizes the situation in the industry and will allow airlines to obtain profitable results, but also stimulates further growth of domestic air transport”.

Russian air transport operators Association – was founded in 1991 as a non-profit organization of aviation enterprises and civil aviation of the USSR. Its membership consists of around 20 leading Russian airlines, providing more than 80 percent of the volume of traffic in the country.