The levy of a 2 per cent cess on domestic flights from January 1 next year is likely to be delayed by at least two weeks. The cess is proposed to be levied to promote regional air connectivity with the funds collected being provided to airlines to cross-subsidise their operations in remote areas.

The reason for the two-week delay is that the draft civil aviation policy, which has proposed the cess, is yet to be approved by the Cabinet. Till the Cabinet approves the proposal it cannot be implemented. A senior government official told newspersons that the inter-ministerial consultation on the policy is likely to be completed by mid-January next year, after which the policy will be sent to Cabinet.

The draft civil aviation policy proposes a levy of 2 per cent cess on all domestic and international tickets on all routes other than Cat IIA. Routes connecting airports in the North-Eastern region, Jammu & Kashmir, Andaman & Nicobar, and Lakshadweep are generally known as CAT IIA routes.

When the draft policy was unveiled in late October, senior Civil Aviation Ministry had said they expected to start levying the 2 per cent cess from January 1 next year.

Meanwhile, in a shift in its earlier stance, the Civil Aviation Ministry now plans to send only one option to the Cabinet on 5/20 rule. The rule lays down that a domestic airline must have a fleet of 20 aircraft and should have completed five years of domestic operations before being eligible for international flights.

The draft policy has come up with three alternatives to the 5/20 rule: One, retain it; Two, remove it completely; Three, airlines be allowed to fly to SAARC nations if they have earned 300 domestic flying credits. For flying to other international destinations the cap is 600 domestic flying credits. An airline earns more domestic flying credits if it operates to remote areas than what it earns if it operates between metro cities or between tier-II cities.

Officials declined to say what option the Ministry will put before the Cabinet. Ashok Gajapathi Raju, the Civil Aviation Minister, has been calling for the removal of the 5/20 rule.

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