Vietravel Airlines wants more tax breaks as fuel prices surge

The import tax is currently 7 percent, and the environment tax on jet fuel was recently halved to VND1,500 per liter, and the airline wants it cut to VND1,000 ($0.04).

The carrier, owned by leading tourism company Vietravel, said the aviation industry faces multiple challenges such as the rising fuel costs, inflation and tightening of purse strings by consumers.

It said fuel costs account for over 30 percent of airlines’ total expenses.

Global jet fuel prices have climbed to a near 14-year high this month in line with the oil supply shortfall.

The airline wants permission to impose a fuel surcharge on local flights if fuel prices exceed $100 per barrel. The current rate is $126 per barrel.

Vietravel Airlines also sought interest-free credit from the government saying airlines have seen their cash fund dwindling after being virtually grounded for two years.

“Without government support, airlines will definitely face payment issues.”

Earlier this week, Vietnam Airlines had called for abolishing environment tax on jet fuel.

It also wanted an increase in price cap for domestic travel to offset the rising costs of oil and improve service quality.