18% GST Fixed on User Development Fees Charged by Airlines: Government Clarifies in Lok Sabha

Last updated: 30 July 2025


Quick Summary
The Indian government has officially confirmed that an 18% Goods and Services Tax (GST) applies to User Development Fees (UDF) collected by airlines from passengers. This clarification, made in the Lok Sabha, aims to ensure consistent tax treatment for UDF, which are levied to fund airport infrastructure development. The GST Council determines these rates, and airlines collect the UDF on behalf of airport operators.

The Government of India has confirmed that an 18% GST is applicable on User Development Fees (UDF) collected from airline passengers. This clarification was provided by the Minister of State for Finance, Shri Pankaj Chaudhary, in response to an unstarred question raised in the Lok Sabha. The questi
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FAQ :

The GST rate applicable on User Development Fees (UDF) is 18%.

The Government of India, through the Minister of State for Finance, Shri Pankaj Chaudhary, confirmed the GST rate in the Lok Sabha.

User Development Fees are charges levied on departing passengers at certain airports to fund infrastructure development. They are typically fixed by airport operators and collected by airlines during ticket booking.

GST rates and exemptions are determined by the GST Council, a constitutional body with representatives from Union and State/UT governments.

Airlines collect the User Development Fee (UDF) as an agent of the airport operator.




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Finance news reporter covering taxation, GST, income tax, business compliance, and economy updates. I simplify complex financial topics into easy-to-understand articles for professionals, taxpayers, and business owners on leading finance and tax platforms.

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