Previously, airlines had the flexibility to submit this information either 24 hours before departure or at wheels-off time.
The Central Board of Indirect Taxes and Customs (CBIC) has recently updated regulations for passenger data submission by airlines, enforcing stricter compliance measures. With immediate effect, all aircraft operators are now required to share passenger data twice: first, within 24 hours before the scheduled departure, and again at the wheels-off time—when the aircraft is cleared for take-off.
Previously, airlines had the flexibility to submit this information either 24 hours before departure or at wheels-off time. The recent amendment, however, has eliminated this flexibility, mandating data transfers at both intervals to enhance compliance and accountability.
According to CBIC officials, the rule change comes amid concerns over underreported Goods and Services Tax (GST) on cancelled flight tickets. Currently, GST is levied at 5% on economy-class tickets and 12% on business-class tickets. Businesses are eligible to claim input tax credit (ITC) for tickets booked for official travel, provided a GST-compliant invoice is issued.
Officials have observed instances where airlines were charging GST on last-minute ticket cancellations but failing to deposit the collected amount with the government. Furthermore, some airlines were found to be claiming ITC on these cancelled tickets. An official from the Directorate General of GST Intelligence (DGGI), who requested anonymity, noted these compliance issues as the motivation behind tightening the passenger data reporting requirements.
The new rule aims to ensure airlines follow due process in GST payments on cancelled tickets, thus helping curb revenue loss and prevent potential misuse of ITC claims.
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