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Ho Chi Minh City
Tuesday, October 4, 2022

Vietravel Airlines asks Gov’t for help

By Dao Loan

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HCMC – Vietravel Airlines, a new aviation market entrant, has proposed the prime minister and the relevant agencies eliminate the financial obstacles facing the airline.

Though Vietnam has fully reopened tourism and created favorable conditions for foreign tourists to enter the country and tour operators to resume their operations, the aviation sector is still facing multiple difficulties over fuel costs, inflation and the spending limit among consumers due to slow economic recovery, according to the carrier.

As such, the airline proposed the financial aid package for air carriers be deployed quickly, meaning that the airlines can access zero-interest loans or preferential long-term loans.

The cash flows of aviation businesses are running out after a long period of hibernation due to the Covid pandemic. If there is no support from the Government, carriers will plunge into debt and fail to pay the salaries of employees, said the airline.

The carrier also proposed the Ministries of Finance and Transport and other competent agencies reduce import tax on aviation fuels to zero against the current 7% and lower the environmental protection tax on fuels to VND1,000 per liter.

The cost of aviation fuel spent by air carriers accounts for a large proportion at over 30% of their total spending, while the prices of the fuel are on the rise, Vietravel Airlines explained, proposing applying the reduction from now until the end of 2022.

Vietravel Airlines also asked for exemption from corporate income tax in 2022 and proposed cutting value added tax by 5% to stimulate the market.

Furthermore, the newcomer to the aviation market proposed halving aviation service costs and allowing the airlines to proactively add fuel surcharge to domestic flights if the price of jet fuel soars.

The Vietnam Aviation Business Association had earlier urged the Ministry of Transport to propose the Government and the National Assembly allow airlines to access refinancing loans worth VND4-6 trillion at zero interest rate.

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