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Air services in the Far East to be exempt from VAT

  • Published in Economy

Flights from the Far East to the European part of the country and back will become more accessible - air services in the Far Eastern Federal District will be exempt from VAT. This was announced by the Russian Minister for Development of the Far East, Aleksandr Galushka, in an interview with Rossiyskaya Gazeta.

"We want to free domestic air transport in the Far East from value-added tax (VAT). We will amend the legislation by March 1, 2018. I am confident that this will serve as a basis for increasing transport accessibility in the district and for lowering prices for air services," the minister said.

In addition, according to him, the so-called "flat" tariffs operate for air transportation to the Far East. Last year, Aeroflot airline carried 1.5 million passengers at this rate. In 2018 it was joined by the Rossiya Airlines, and it will allow for approximately 900 thousand people take advantage of these conditions. Now the cost of a flight, for example, from Khabarovsk to Moscow and back, is 25,000 rubles from Aeroflot, and 22,000 from Rossiya.

In addition, the government is developing additional mechanisms to ensure that flights from the Far East to the European part of the country and back become more accessible. So, 600 thousand people - young people and pensioners - took advantage of discounted air tickets in 2017. In 2018, the privilege can be extended to large families - there are 74.2 thousand of such families in the Far East. We will also prepare our proposals by March 1, 2018.

When asked how many airports and aerodromes the Far Eastern region lacks, Aleksandr Galushka, without hesitation, said: "At least forty, top-priority ones." He noted that since the beginning of the 1990s only a sixth of the total number of airports and landing sites remained in the Far East. Today about 70% of the territory does not have sufficient aviation accessibility.

This is a vital issue, the minister believes. Therefore, when preparing the draft budget for 2019 and the planning period of 2020-2021, the Ministry of Transport and the Ministry of Economic Development was instructed to allocate additional funds for the reconstruction of 40 airports, in particular, in Neryungri, Sangar, Polarny, Omolon, Pevek and other cities.