End in Sight for Tax on Foreign Aircraft

The Transportation Ministry will propose cutting or scrapping import duties on foreign aircraft, a spokeswoman said Friday, a day after the prime minister called for overhauling flight safety standards for the country's aging civilian air fleet and airports.

A proposal to change the unpopular 20 percent duty on imported foreign aircraft was to have been submitted to the government later Friday, a ministry spokeswoman said, speaking on condition of anonymity because the proposals had not yet been submitted.

The ministry is hoping to have the tax eliminated altogether, she said.

Aviation experts have said the import duty has put Boeing and Airbus planes out of reach for cash-strapped airlines, forcing them to buy aging foreign planes or domestic aircraft. In the past, only national flag carrier Aeroflot and private carrier Transaero have been given state breaks to purchase new foreign jets.

The proposal also calls for building additional runways at 12 airports, including Sheremetyevo and Domodedovo airports and St. Petersburg's Pulkovo Airport, the ministry spokeswoman said. More than 400 people have died in the past year in a series of airline crashes involving the airline industries in Russia and other former Soviet republics, prompting government officials to call for better safety standards.

Prime Minister Mikhail Fradkov on Thursday told a Cabinet meeting on flight security that Russia should not rely solely on new foreign planes, but needed to quickly reform its struggling aviation sector and accelerate homegrown production.

Despite a substantial production capacity, Russian factories produced just a handful of civilian aircraft last year, while domestic airlines imported 20 used foreign jets. In total, 200 foreign aircraft are used by Russian airlines, Vedomosti reported Friday.

The country also lacks an affordable leasing system that would allow companies to acquire new Russian planes, meaning companies typically chose instead to buy older foreign or domestic jets.

In a bid to boost domestic production, the government is pushing ahead with the creation of a national aircraft holding company to unite the country's civilian and military producers under one corporate roof. The United Aviation Corp. has been promised hefty state funding and will be 75 percent controlled by the state.

Last week, a Tu-154 jet belonging to Pulkovo Airlines crashed in Ukraine after encountering a storm, killing all 170 people aboard.

In July, an Airbus A310 belonging to S7 skidded off a runway and burst into flames in the Siberian city of Irkutsk, killing 124 people.

In May, an Airbus A320 belonging to the Armenian airline Armavia crashed into the Black Sea in rough weather while trying to land in the resort city of Sochi, killing all 113 people aboard.