The civil aviation ministry is holding talks with the finance ministry on rationaliation of sales tax on aviation turbine fuel and airport taxes.
This was stated by union minister of state for civil aviation Shripad Y Naik in New Delhi on Saturday.
ATF currently attracts tax up to 25-30 per cent, and the proposal is to reduce it to 4 per cent.
"We are making continuous efforts to develop the sector, and a civil aviation policy will be announced soon," Naik said.
There were plans, he said, to develop areas like cargo handling operations, which are viewed as a major revenue generator by the industry.